BTC/USD Price forecast for the week of January 22, 2018, Technical Analysis

Bitcoin traders finally sold the market off during the week, breaking below the crucial $12,000 level. That is an area that has been massively supportive in the past, and although we turned around to show signs of strength again, it was based upon almost no volume. The strength of the candle is formed mainly to the downside, especially when you look at it from a shorter-term perspective. While the candle does look a bit like a hammer, we are starting to see during the Friday session of low-volume that the 12,000 level is offering resistance. Because of this, this is a bit of a tricky weekly chart to look at, because if you were not willing to drill down to lower time frames, you might be tricked into buying.

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BTC/USD Video 22.01.18

If we break down below the bottom of the weekly candle, the bottom will fall out of this market and we will more than likely go looking towards the $6000 level next. A break above the top of the candle would send this market towards the $12,000 level. The market will more than likely be very noisy, but I think that most retail traders that have gotten in the Bitcoin are now losing money. Remember, the massive amount of volume that came into the market as far as accounts opening at exchanges occurred closer to $20,000. Most of those people have not only lost money, but have probably close their accounts by now. Anecdotally, most of the retail crowd that I know have only a small amount of money in this market, and quite frankly bought Bitcoin on the idea of a “flyer.” I think longer-term traders will be a lot of find more value down the road, so therefore patience will be needed.

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