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Bitcoin Monthly Forecast – November 2018

The BTC/USD pair traded range bound across the month of October 2018, trapped within a small price band of $6200 to $6600 as overall sentiment surrounding the pair in recent months has been consolidative in nature. The first week of October saw the pair move with slight upward incline from $6450 to $6656 owing to large investors and major companies diversifying their portfolio as US greenback gained strength in broad market and fall in major stock indices. The volatility for the pair is very less as most retail traders who are looking for short term profits have moved away from the pair owing to lack of major economic data and high impact news that could affect the price action in this pair. The current momentum is merely a shadow when compared to momentum of pair at same time last year. For now major players in this pair are investors with fundamental approach who can afford to hold their investment for prolonged period of time and major companies and they wield high level of influence over the pair’s price action. The proof of consolidative price action in the pair is strong level of resilience surrounding support and resistance levels which has in recent few months held the pair well inside $6000 price handle despite multiple attempts to breach $5000 & $7000 handles on multiple occasions with each move being pushed back inside $6000 price range.

The Pair Turns Bearish As Retail Investors Bail Out Post Profit Booking

Many major companies have forayed into crypto industry of late but the news has had very little impact on Bitcoin’s price action. While the previous week saw few retail and small time traders stock up short volumes following the trend of major investors, it was a long weekend in US and Canada which resulted in very slow price action and little volatility as many major players were from US and this pushed the pair into a bearish decline. The pair hit a weekly low of 6226.3 during the second week but managed to make a positive rebound as trading session came to close for the week thanks to bullish influence gained from news that Bithumb, South Korea’s largest BTC exchange sold over 38% of its equity to a consortium of companies that is based out of Singapore in a deal that was said to be worth $350 million which was sign of how huge crypto market was in south Korea while also providing indication that crypto market is hale and healthy despite subdued demand for crypto coins when compared to same time last year. The third week opened positive for the pair as price action saw a positive shoot up that resulted in erasing all losses from previous weeks and make considerable gains as price shot up all the way to $7704.2 but high level of profit booking activities and lack of fundamental support to help keep price above $7000 handle resulted in price coming down shortly.

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The pair then maintained a consolidative range bound price action for rest of the month. As the pair has been an instrument with very little growth in price action over a course of few months which made it impossible for retail traders to hold long positions resulting in steady sell off. As total number of players who could cause major impact in BTC market was very little and price action was heavily influenced by major investors, retail trading activity was very low for the pair resulting in very little volatility across the week. While BTC bulls tried to take control of market, there was very little support for bulls as investors had suffered a dent in their confidence owing to multiple situations in recent past when such an attempt ended in failure and failure of bullish rally to materialize in actual market despite many analysts predicting such an occurrence over the course of past month. But bulls had done well as the pair managed to stay above $6500 across third week despite lack of fundamental support and volatility in the market. The last two weeks saw BTCUSD pair move on steady range bound price action with bearish inclination owing to investors turning away from the pair.

Range Bound Price Action Likely To Continue Across November As Major Investors Continue To Maintain Strong Hold Over Price Action

There are several reasons for investors avoiding the pair such as lack of news surrounding bitcoin that could cause major impact on market, lack of volatility and lack of liquidity. In additional to already existing bearish factors, news that investors and traders were facing problems at the Wex exchange with struggle to withdraw their holdings hurt investors sentiment resulting in fourth week seeing range bound price action that took price as low as $6432.30. The last week of October was highly bearish for BTCUSD pair as concerns over issue with Wex exchange resulted in a sharp decline in price with pair seeing over $200 decline and hitting monthly low at $6248.2 before managing a bullish rebound on last trading session of the month. The issue with Wex continued to hurt investor sentiment at start of November as news hit market that the Binance exchange has been freezing the wallets that are related to the Wex exchange which inspired a high level of dovish sentiment among crypto investors.  Overall the month of October was bearish for BTCUSD as the pair closed at price well below the price at start of the month and this was mostly due to majority of day traders and the speculators from last year deserting crypto market as investment from retail investors played a major part in Bitcoin’s Bull Run last year. Seasonally, the BTC prices tend to pick up towards the end of the year and the traders and the investors are hoping that this pattern would continue this year as well which has resulted in some positive bets during first week of November that has helped the pair reclaim $6500 price range. Moving forward with the month of November,  major investors and huge financial companies continue to maintain strong hold over price action of BTCUSD pair and they seem to be content with ongoing price action which indicates that range bound price action is likely to continue across the month of November as $5000 & $7000 price handles retain their position as strong support and resistance levels but if seasonal price action is to follow its pattern, then activity from retail traders might provide a bullish bias to price action even if the pair continues to move locked within the price range.

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This article was originally posted on FX Empire

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