Weekly Technical Analysis – 28 May 2018
Markets continue to remain bearish in the 2nd quarter of 2018 despite my hope that we would resume the bull trend. The market dominance charts suggest that we might see a rally in bitcoin over the coming weeks compared to altcoins. This does not necessarily mean that bitcoin will do well against the US dollar, but rather not lose as significantly as compared to other coins. This might be a good time to sell some other portfolio holdings and move them into bitcoin. We’ll have to wait and see if this is a good idea.
Bitcoin is approaching a key support level on the charts. Usually I would say that we need to hold this level to maintain the bullish bias for the digital gold coin. However price action is a tricky thing and with indicators at these levels more often than not this has been a good buying opportunity. If you are a trader, you might want to take a position here with a tight stop. If you are an investor then this should be a good buy and hold opportunity for the long term.
As I’ve outlined in one of my first posts titled A Tale of Bubbles the Dollar and all other major currencies around the world continue to be devalued in a race to the bottom by central bank money printing. This can only end badly for the fiat currency system. Even if we lose another 20-30% in bitcoin from here the probability is extremely high that we move up in the longer term.
A good system for getting a hold of crypto is dollar cost averaging which allows you to scale into and out of position when searching for the best price. This process works better for longer term investors.