Cloudy Future for Bitcoin Could be an Opportunity for Bears on Cryptos?
Fundamental view
During the last Financial Services subcommittee, regulators and the institutions caused a huge hit to Bitcoin. Precisely, members of Congress raised concerns about the shady uses of Bitcoin, and the lack of investors’ protection.
The congresswoman Carolyn Maloney stated that “they’re pouring their life savings into virtual currencies and they stand to lose a lot of money when this bubble eventually bursts“. In addition to this, the congressman Brad Sherman described cryptocurrencies as a ‘’crock’’.
According to CNBC, Google will ban cryptos’ related ads, something that gives another significant hit to the cryptos.
The question that arises is whether this could be an opportunity for bears. In order to answer this, it is needed to examine the technical side so that to find out if there is a potential forming trend.
Technical view
On the daily chart, it could be noticed a confirmed Kumo break out to the downside. In order to justify this, the components of Ichimoku system should be examined. Firstly, the price, the Tekan Sen, and the Kijun Sen are out of the cloud. Furthermore, the Chikou span is out of the cloud and is trying to get out of the price too.
Regarding Bitcoin, given that fundamentals are taken into consideration, it could be said that for the time being we are in a downtrend and, we could look for potential bear signals at the 4H timeframe once the price comes back to Kijun Sen.
Be aware of the fact that cryptos are highly volatile pairs and there is a high probability of moving in very rapidly within the day. Therefore, be careful and always estimate the risk before entering the market.
Daily time frame
4H Time Frame
This article was written by Marios Athinodorou, TeleTrade’s market analyst, and commentator. Among others, Marios is delivering weekly trading webinars. Sign up for upcoming webinars here.
This article was originally posted on FX Empire