Bitcoin still bouncing off major support, remain bullish

Bitcoin still bouncing off major support, remain bullish

Bitcoin continues to test our major support, remain bullish for another bounce while keeping a tight stop loss.

Buy above 9381. Stop loss at 8897. Take profit at 10728.

Reason for the trading strategy (fundamentally):

The big news event on the horizon is the US Congress set to hold a hearing next week on cryptocurrencies and initial coin offerings (ICOs). The hearing would largely be educational in nature and stated the Financial Services Committee members have a growing interest in learning more about the subjects and the implications of the tech’s use in areas like remittances. This foray into the world of cryptocurrencies and embracing it instead of turning against it is a good sign for cryptocurrencies in general.

Reason for the trading strategy (technically):

Price made a bounce yesterday before dropping to our support level once again. We remain bullish above major support at 9381 (Fibonacci retracement, horizontal overlap support, Fibonacci extension) for a bounce up to at least 10728 resistance (Fibonacci retracement, horizontal breakout level).

RSI (34) sees major support above 34% and a corresponding bounce could occur at this level in line with our short term recovery on price. We can also see bullish divergence vs price signalling that a bounce is impending.

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About the analyst

Desmond Leong provides technical analysis to the largest banks, hedge funds, and brokers whilst coaching hundreds of aspiring traders. He specializes in providing actionable and accurate analysis that utilizes the most advanced theories.

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