Bitcoin (BTC): 3 relevant graphs not to ignore in its market forecast

The Bitcoin (BTC) price remains in position under a key technical threshold at $ 8,500 (€ 7,500). here is 3 graphics relevant to integrate into your thinking while waiting for the market to make its directional choice.

Key technical factors of the article:

  • Graph 1 : the long-term graph of Bitcoin price on a logarithmic scale.
  • Chart 2 : The histogram of trading positions opened on the Chicago Mercantile Exchange (CME) Bitcoin future contract by institutional investors.
  • Graph 3 : the comparison of the daily Japanese candles in the Bitcoin price with the net balance of contracts held to buy and sell by strong hands.

Bitcoin graph in logarithmic scale since 2011

This first graph makes it possible to take a step back from the long term in the best way. It indeed represents the bitcoin price since 2011 using a logarithmic scale (Y axis).

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This scale takes into account the evolution of Bitcoin in% and not in absolute dollar (or euro). On a conventional arithmetic scale, going from $ 1,000 to $ 2,000 is the same as going from $ 8,000 to $ 9,000. In the long term, this scale is wrong from the point of view of capital invested because in the first case there is a doubling, in the other case a little more than 10% increase. The log scale therefore allows to have a fair representation of Bitcoin price from a capital invested perspective and that’s the only concrete reality for a trader. In log and long term, the upward trend in BTC is therefore beyond doubt.

CFTC Bitcoin COT Report

This second graph is a histogram which gives each week (each Friday with data from the previous Tuesday) number of future contracts held for purchase and sale on the BTC by institutional investors. Since the beginning of the year, we can see a sharp increase in contracts held for purchase (one contract is equal to 5 BTC), but also a sharp increase in those held for sale. In the end, the net balance (purchase contracts minus sale contracts) is negative (-1144 contracts), institutional investors are therefore still mostly sellers but they still slightly reduced this net selling position. Much more will have to be done to envisage the continuation of the increase at the start of 2020.

Bitcoin price – TradinView

Finally, this third graph offers a association of Japanese daily candles for a year of the Bitcoin price, with the net balance of positions in the future BTC contract. Look again in March / April 2019 as the increase in buying positions by institutional traders has "raised" the BTC. This remains the key and especially since Bitcoin needs long capital to overcome the strong resistance at $ 8,500.

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This week of Monday January 13 will allow to know if the technical rebound since $ 6,500 ends under this technical border of $ 8,500 (€ 7,500) or if, on the contrary, this threshold is exceeded with force and volume to fetch the $ 10K. It’s only one breakout day that will provide the answer.

Follow Vincent Ganne on Trading View for further analysis on the financial markets.

The technical thresholds and the trend indicated above are based on the technical approach "price, momentum, sentiment, ichimoku". The data come from Bitstamp and the graphics of TradingView. You can consult the history of our technical points on cryptocurrencies in click here.

This content is offered for informational purposes only and does not constitute an investment recommendation. We remind you that theinvestment in crypto assets, including Bitcoin, is extremely risky. Cryptocurrency prices are likely to suffer significant andunpredictable price fluctuations.

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