Time For Volatility?

There is always speculation on where BTC is going next, but at times like this I find it helpful to step back and take a look at the facts instead of listening to wild speculation on Twitter. And so, I want to present to you an unbiased opinion of where the Bitcoin price will go in November of this year. 

The Facts

• Bitcoin is nearing a year of bear price correction
• Many alts have already bottomed out and we are now seeing pops across the board
• Bitcoin fundamentals are as strong as ever
• Sentiment seems to be neutral across social media
• ETFs decisions still loom, with several denials already
• Bitmex has been experiencing record volume
• Tether FUD running rampant

Most of those bullet points seem bullish, but there's enough uncertainty there to want to expand on some of those ideas.

Yes, Bitcoin has been in almost a year long correction, but the 2014 fractal suggests that after this brief uptrend we are due for one last dip to around $4500. This would be another huge shakeout and if that happens I expect a sustained bull trend to follow.

Alts popping across the board seems to be a good sign. At the very least, it means that people are interested in trading at these prices.

There has been tons of mainstream and traditional infrastructure coming out to support Bitcoin. It is now easier than ever to invest in Bitcoin and other cryptos. 

After a prolonged period of very deperessing Twitter activity, people seem pretty positive in light of recent price action. There still seems to be an even split of bears and bulls on social media. 

Many of the ETFs were denied, but some were delayed. As long as these decisions loom, BTC speculators will look to these dates as decision points for BTCs price and they will want to trade it accordingly. 

Bitmex has been getting tons of volume and has been setting records. I consider this a neutral signal. If we were getting this type of volume on regular exchanges, it would be bullish. But for all we know, a lot of this volume could be people looking to short. Volume on Bitmex means less, but at least people are trading. 

I'm sure you've seen the Tether FUD. Last week, Tether dropped to 90 cents on the dollar. It provided a huge opportunity for arbitrage and Tether is now back to being close to spot with USD. FUD usually indicates bullish times on the horizon, but it's not a strong enough indicator to actually trade off of it and correlation does not imply causation. For now, it's just curious. 

So, as far as fundamentals go, I'm leaning slightly bullish for the short-to-medium future.

The Technical Analysis

Fundamentals are one thing, but TA is another. I like to make my trades based on both combined. So withour further delay, let's look at the chart. For Bitcoin, I like to look at the daily chart, especially when trying to forecast for the next month. 

Here's what we're looking at on the Bitcoin daily. 

We have made progress and broken what I see as a major resistance line. I expect us to retest that resistance before we move up at all to allow some of the indicators to reset. I think we will revisit the low $6000s, perhaps bottoming out around $6200 or $6150 and then using that resistance as a strong support to prep a little bull run. 

I expect us to move upwards for almost the entire month of November. Now, for how long that will last and how much progress we make depends on a couple of factors. If we are going by the current chart, we could definnitely see the mid $7000s in November. We do have a couple of strong resistances at that point and if we break those, I would not be surprised to see $8000 by December. 

Another thing to keep in mind is that whichever direction we move, it's due to be a big one. The Bollinger Bands (measure of volatility) are very tight on both the 1 day and 3 day charts. 

Now I want to take a look at the 2014 chart. Even though I consider this chart to be of little significance, it is a pretty good model for corrections after huge price increases. I don't expect us to follow the same path because the fundamentals are different. I only want to look at it because it is interestingly similar to the present-day chart. 

As you can see, Bitcoin followed a very similar correction pattern with the price bouncing off bottom support several times before the 1 day Bollinger Bands got tight and we got a nice little bull run. This bull run was followed by a prolonged Bear market that saw new lows, so even if we are currently in that yellow circle, it might not all be good news. 

As I said though, today is different than now. If we get a bull run here, I would not be surprised at all to see new highs within 6 months. We could definitely sustain a bullish price move by Bitcoin with today's fundamentals. 

All things considered, my official price prediction for November 30th is $7900. 

I'm feeling bullish, are you? Let me know what you think in the comments!