FxWirePro: BTC/USD upside capped by 5-DMA, good to go short on close below 1h 20-SMA
BTC/USD plummeted to 1830 levels on July 16 as it broke below major moving averages. It has once again restored its strength to above the 2000 mark and is currently trading at 2090 levels at the time of writing (Bitstamp).
Ichimoku analysis of daily chart:
Tenkan Sen: 2197.32
Kijun Sen: 2287.50
On the upside, immediate resistance is seen at 2097 levels (5-DMA) and a break above would see the pair testing 2131 (2h 50-SMA)/2160 (Cloud bottom). Further strength would see it testing 2221 (2h 100-EMA)/2259 (10-DMA)/2301 (1w 5-SMA)/2395 (20-DMA)/2437 (convergence of cloud top and trend line joining 2980 and 2639).
On the downside, support is seen at 2021 (1h cloud bottom) and a break below would drag it to 1984 (1h 50-SMA)/1957 (1h 20-SMA)/1935 (50% retracement of 891.33 and 2980). Further weakness would see it testing 1850 (May 27 low)/1813 (1w 20-SMA)/1755 (50% retracement of 751.34 and 2760).
Momentum studies: On the daily chart, RSI is weak at 36, MACD line is below the signal line, and stochs are in the oversold zone. The bulls have flexed their muscles driving the bitcoin price to above 2000 levels. Overall bias remains bearish as 5-, 10-, and 20-DMAs are biased lower. The pair’s upside is capped by 5-DMA and further bullishness could be seen only on close above.
On the weekly chart, stochs are biased lower and a bearish MACD cross over could be seen. However, RSI is at 57.
On the 1-hour chart, the pair is facing strong resistance at 1h 100-EMA and a break above would see further upside. MACD line is above the signal line and RSI is at 62. Stochs are in the overbought zone.
Recommendation: Good to go short on close below 1957. SL: 2133. TP: 1830/1813.
FxWirePro launches Absolute Return Managed Program. For more details, visit http://www.fxwirepro.com/invest