BTCCNY Technical Analysis: Descending Channel Resistance

0
142

BTCCNY is trending lower on its 1-hour chart after previously breaking below an ascending channel formation. Price is now forming a descending channel and is on its way to test the resistance at 6750.

The 100 SMA is below the longer-term 200 SMA so the path of least resistance is to the downside. The gap between the moving averages is widening to suggest stronger selling pressure while the 100 SMA appears to be holding as dynamic resistance so far. The 200 SMA is closer to the channel resistance and may be the line in the sand for a pullback on this downtrend.

Stochastic is still moving up to suggest that buyers are in control of price action right now. This could carry on until the oscillator makes it to the overbought zone and turns lower to indicate a return in bearish momentum. RSI seems to be on the move down but is stalling at the middle of its range and might reflect a bit of buying pressure in play.

Bitcoin continues to be under heavy selling pressure as the network hard fork is causing several investors to be concerned. This debate has been going on for years yet there has been no solution or alternative proposed, leaving the network to address the scalability issue on its own. Some worry that the new version of the software could render old bitcoin invalid, thereby causing several holdings to lose value.

This has prompted profit-taking in the past few weeks, on top of the already-strong downside pressure from potential Chinese regulation. With these issues still in play, bitcoin could be left with no choice but to give up more ground against the yuan and its other counterparts.

A number of exchanges have already warned their clients of the risks involved, citing that they may not be able to support either new or old versions. “Bitcoin Unlimited has been listed on the platform and is available for trading from March 24. The exact date of the hard fork is currently unknown and BTC and BTU withdrawals are temporarily locked due to the probable replay attack which may occur after the split. Withdrawals will be unlocked soon after the hard fork is complete,” HitBTC wrote in a statement.

Note that Bitcoin Unlimited and SegWit, two implementation versions of the hard fork, cannot co-exist. Other platforms such as Bitfinex, Bitstamp, BTCC, Bitso, Bitsquare, Bitonic, Bitbank, Coinfloor, Coincheck, itBit, QuadrigaCX, Bitt, Bittrex, Kraken, Ripio, ShapeShift, The Rock Trading and Zaif have published contingency plans for eventualities.

“As exchanges, we have a responsibility to maintain orderly markets that trade continuously 24/7/365. It is incumbent upon us to support a coherent, orderly and industry-wide approach to preparing for and responding to a contentious hard fork. In the case of a bitcoin hard fork, we cannot suspend operations and wait for a winner to emerge,” their statement indicated.