This week has been quite a roller coaster in terms of price movement. Earlier this week the market had a mini $14 bull run which brought bitcoin to the pre November bubble range of $330. In my last bitcoin technical analysis I discussed how the price drop on the 15th was nothing but a bull trap. Whether the current drop will prove to be yet another bull trap is up for debate. Volume died down after the 17th and as mentioned earlier, traders were waiting on the sidelines watching out for the next wave.
The wave sure came today in the form of a quick faith test as the price dipped over $20 and touched $310. Part of the reason for the crash seems to be the emergency meeting that the EU is holding on friday regarding regulation of virtual currencies, gold, and precious metals, as a response to the recent terrorist attack. However, in light of recent news, bitcoin and encryption did not play a role in the paris attack because the Paris police found a cellphone with an unencrypted SMS saying “Let’s go, we’re starting”.
bytevc from r/BitcoinMarkets summarized the current state of the market and remains bullish:
A nice bounce off our $315 support line; futures settlement behind us; strong, China-led buying; and, last but not least, full-out doom mongering on this sub today: I’d say we’re headed up.
On the other hand, users on tradingview share a bearish vibe and FxWirePro claims that the price is going to further decline as EU looks to regulate BItcoin further and advises to sell on rallies.
Technically btc is facing strong support around $300 and any break below target $270$256 in short term.
On the brighter side major resistance is around $350 and break above will take the pair to new level $370/$400.
It is good to sell on rallies around $320-325 with SL around $355 for the TP of $270/$256.
A few hours ago, the Washington Times released an article claiming the EU is going to potentially ban bitcoin during the meeting on friday. However, the article simply quotes the original reuters article which is linked earlier in this post. Such articles may scare weak hands and more sells may follow if the media keeps sensationalizing ideas to ban bitcoin.
Currently bitcoin is trading at $320 on a rebound rally from the earlier drop. Do you believe the EU will ban bitcoin any time soon? If you liked this article follow us on twitter@themerklenews and make sure to subscribe to our newsletter to receive the latest bitcoin and altcoin price analysis and the latest cryptocurrency news.