Bitcoin Price Analysis (BTC/USD) August 17, 2017

on Aug 16, 2017
Updated: Sep 19, 2019

Bitcoin broke higher during the session on Wednesday, touching the $4300 level.

On the hourly chart, we have cleared a significant amount of resistance at the $4200 level, but one should be aware of the FOMC Meeting Minutes coming out later in the day on Wednesday, which gives us a directional bias of the Federal Reserve.

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Because of this, we could see a significant amount of choppy volatility in this market. Also, as I write this, the $4300 level is a conjunction of a previous uptrend line.

If we can break above 4300 and sustain it, then I feel that Bitcoin has the ability to go much higher. The $4400 level will cause a bit of resistance, but the target is probably going to be closer to the $4500 level.

Buying dips

Currently, the buy the dips” attitude has worked in Bitcoin, but the recent selloff was rather brutal. On Monday, the market lost $600 at one point. That is an extreme amount of volatility, and I think that it’s probably going to only be a matter of time before institutions bail on this market, if we continue to see 10 and 15% swings.

That of course would be bad news for the overall demand. I believe that we can get to the $4500 level, but I also think that it’s going to cause a significant amount of resistance.

After all, markets like large, round numbers, and that’s about as large as it gets. On the other side of the coin, the $4000 level below should act as fairly significant support, extending down to the $3800 level on a pullback. If we were to break below the $3800 level, then I think the market will sell off much more rapidly than we saw on Monday.

Remember to take your position sizing slow, it’s the best way to protect your trading account.