Bitcoin seems to bitcoin technical analysis the hot topic these days. I send out a couple of bitcoin charts and the twitterati goes wild.
It’s a quick tell that there is certainly interest. It was not quite like this before Bitcoin was able to exceed the 2013 highs. But once prices got going and all-time highs became a regular thing, the cults start to follow. Contrary to popular belief, the price of Bitcoin hasn’t just gone straight up. The cryptocurrency, in fact, has gone through a series of very symmetrical and well-defined corrections along the way. Today we’re taking a look at Bitcoin from multiple time horizons to get both long-term and short-term perspective using our Fibonacci tools. When it comes to setting traditional prices targets and risk management levels, it becomes a challenge when the stock or asset in question has never traded there.
In other words, where do we look for overhead supply when we’re in uncharted territory? We use the Fibonacci sequence for this purpose. Once prices earlier this year exceeded the 2013 highs, the next logical level was approximately 1875, which is the 161. These levels can act as both support and resistance.
In this case, Bitcoin prices exceeded 1875 to reach the 2930 level, which is the 261. Notice how prices then came back down to successfully retest that 1875 level, acknowledging the new found support. Remember, these levels were not drawn after the fact. After that retest of 1875 this Summer, prices went on to break out once again above the former highs near 2930 resistance.