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Bitcoin looks set on another march towards record high set on last month. The previous record-setting rally was halted by strong profit-taking before Chinese New Year and ensued by another Chinese official repressive operation on Bitcoin exchange.

The People’s Bank of China (PBOC) has been hounding domestic bitcoin exchanges for some time now, pressuring them to ensure compliance with existing financial regulations and issuing warnings about the risks of bitcoin trading. As a result, most mainland BTC exchanges froze margin trading and temporarily halt yuan withdrawal for a month. These would prepare the exchanges upgrade their integration systems for compliance to the government new restriction measures and customer’s transparency.

This crackdown caused a short-lived jittery in Bitcoin price and volume. The Chinese speculative volume had been the dominant force behind BTC bull run that saw its price spike from $600 on October to record high of $1160 in the first week of 2017.

Contrary to previous Chinese government interventions, this time Bitcoin price dump was much smaller and recovered more quickly than market anticipated. The impressive restoration of Bitcoin are largely due to these developments:

Peer-to-peer Trading Platform

Peer-to-peer Bitcoin trading platform are locking in record-levels of interests. LocalBitcoins China trading volume to 5,000 Bitcoins per week, which is equivalent to $5.3 million in weekly trades.

Ripening of Japanese Bitcoin Market

Japanese Bitcoin transaction volume is now the largest overtaking China in Bitcoin market. The Government supportive regulatory frameworks on digital currency has open up the mass merchant adoption of Bitcoin. Japanese-based exchange such as bitFlyer is now one of top BTC exchange and Yen is the most traded fiat currency on Bitcoin transactions.

Progression and Resilient of Chinese Traders

Chinese traders had been become more pliable with more trading options. They are now easily shift to peer-to-peer trading system such as Localbitcoins as well move their bitcoins to other exchanges outside China.

Chinese regulatory alliance initiative

The announcement from Chinese financial regulators led Chinese investors and traders to become more optimistic towards the relationship between local exchanges and regulators, instead of fearing the involvement of PBoC.

The Chinese government and Bitcoin exchanges have also announced the formation of a regulatory alliance focused on Bitcoin, to discuss potential regulatory issues and growth-related conferences with the local Bitcoin community.

ETF Grapevine

The much-anticipated Bitcoin ETF, which has been going through the SEC bureaucratic process for now more than three years could be conclude by next month. Speculators are fully exploiting on this hearsay and creating numerous positioning “hoo-ha” and opportunities.

BTC/USD Technical Outlook 21 February 2017

BTC/USD Weekly chart
BTC/USD Weekly chart. Data

This week BTC/USD leaping ahead last week price. The doji candles both coincidentally above the sequential two bear candles which served as resistance levels were indicative the selling force was fully factored-in. The bull is in dominant position implied from the larger-sized bullish candles. The ADX is rising high showing strength of the ongoing trend is still strong.

Important BTC/USD price levels to marked,

Year High – $1164.01 (January 05 2017)
Year Low – $760 (January 12 2017)

BTC/USD Daily chart
BTC/USD Daily chart. Data

The last of BTC at $1090 softer from yesterday close of $1094, sparsely aloft on 0.786 Fibonacci Retracement Level. Yesterday BTC gained +3% fully redeemed loses incurred from the PBOC dump. The price could set the path to peak of 1164 which is aligned to the rising wedge. Thus, making it the only well-defined hurdle. Any correction would be take on the support zones at 1033.50, sub-1005-1009 and 960. Any closed below these level would preserve the uptrend up to next month.

Important Price Levels for the Immediate Term Based on Fibonacci Retracement Approach

Crucial Resistance Levels
1164.01 (Year High on January 05 2017)

Crucial Support Levels
S1 – 1033.50
S2 – 1005-1009 (0.618 Fibonacci Retracement Level)
S3 – 960 (0.5 Fibonacci Retracement Level)

And The XBT/USD Futures (BTC7D) on BitMEX market

XBT/USD Futures (BTC7D) daily chart
XBT/USD Futures (BTC7D) daily chart BitMex.

The last transacted contract valued at 1082.72. The buying deals and wall is still looks bullish. Ichimoku Kinko Hyo viewpoint also indicating rooms for further lifting. Conversion over base line still drafting above the cloud.

On BitMex, the XTC derivative is in the form of a Futures Contract and allows traders to speculate on the future value of the Bitcoin / Bitcoin (XBT/USD) exchange rate. Traders need not have Bitcoin to trade the futures contract as it only requires Bitcoin as margin.
Trade Bitcoin on BitMex Futures

XBT/Yuan Futures (XBCH17) on BitMEX market

XBT/Yuan Futures (XBCH17) daily chart
XBT/Yuan Futures (XBCH17) daily chart BitMex.

XBT/Yuan Futures contract is priced at 7420, gap up from yesterday close. These level is near to the critical support levels which stubornly keeping check of previous two price rallies.

XBCH17 is a XBT/CNY futures contract settling on Bitcoin and Yuan. Each contract is worth 10 CNY of Bitcoin. This contract is ideal for speculation. The expiry month code is H (March). Trade Bitcoin/Yuan pair on BitMex Futures

BTC/EUR Technical Outlook 21 February 2017

Bitcoin vs Euro pair (BTC/EUR) last price at 1005.68, another hike of +1.84% from yesterday. The direction is trailing BTC/USD but in slower pace. BTC/EUR price struggle to get past the level set on pre-PBOC clampdown. But the sentiment is heavily bull bias, so the breakup is just matter of time. Other than that, the ETF could be important to the mix especially any negative announcement could pave a sharp correction.

BTC/EUR weekly chart
BTC/EUR weekly chart. Source:Simple FX

BTC/EUR daily chart
BTC/EUR daily chart. Source:Simple FX

Trade BTC/EUR on Simple FX

BTC Exchanges and Charts With BTC #BTC Trading
BitMex Futures
Simple FX
Whale Club

Chart via tradingview, data source from SimpleFx, HitBTC,

The author is a self-described cryptocurrency activist. Ironically, he is not involved directly on the development and mining. But a keen trader that specifically studying and analyzing the chart and prices based on zen principles of candlesticks price action techniques. And most importantly, he is always prone to deceiving price movements that can exposes to trading losses. So trading based on his personal opinions is extremely risky and not advisable.

Please do your own due diligence before making any investment decision. This article should not serve as investment advice. This post is mainly as reference and tutorial for trading on possible cryptocurrency breakout.

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