Range $329 today. Yesterday the range was $365
Bitcoin is having another down but quiet day. Yesterday, the digital currency was down modestly, and traded in a relatively narrow $365 trading range.
Today, the range is even more narrow at $329. The price is down -$164 on the day.
It is not much, but for longs, is the market getting to the point of feeling like death by a thousand paper cuts? That is a risk and the technicals are certainly not helping.
The low today reached $6518.88.
The high today reached $6847.
The price remains below the converged 100 and 200 hour MAs at $6984 (blue and green lines in the chart above). Both those MAs (blue and green lines) are moving lower. If the price is to continue to fall, stay below those MAs will keep the bias to the downside, and in the process keep the longs uncomfortable (another paper cut).
On the downside the April swing low at $6450 is the next obvious target.
Looking at the daily chart, the swing levels at $5873 (low from February), $5511 (low from November 2017) and $4980 (swing high from September 2017) are the next targets.
What is worrisome for the largest cryptocurrency is that the price is no where near the December/2017 year high at $19891 (on Coinbase). Yet, the low for the currency from January 2017 was way down at $734. That can give a false sense of security to the early buyers.
Early adapters are still in the money, but nearly everyone who bought from mid-November 2017 are underwater. Most of those buyers, bought because of the story line that was focused on the next currency, with limited supply, a global presence, no regulation, even no taxes. Those buyers didn't really have a risk focus, just a "sky is the limit" story focus - and the price action supported that view.
Now.....as the story line changes to one of more regulation, more concerns about liquidity, "bad actors", the IRS hounding the winners (who may have big tax bills), that "new" story line will overshadow the "old" story line that sent the price soaring (it is already doing it honestly).
Do we go back to $734?
The run up to $20,000 seemed improbable. A move to $734 does too. So we cannot discount the possibility.
The fact is making money feels great, and losing money feels really horrible.
When your investment goes up by multiples, it makes you feel rich. It changes your lifestyle. You may spend more, borrow more, live the high-life.
When that wealth disappears and your gains are losses, or your gains don't make you feel rich anymore (and you have the expensive sports car in the driveway with big payments), you act differently and you feel....horrible.
If the early adapters start feeling the pinch - and they already are - if the feelings of being rich, fade with each $100, $500, $1000 decline, even they will think twice about what is the real story line.
Technically, there is little bullish from the charts now. Now, that can change. Just get above the 100 and 200 hour MAs and stay above and there is some hope - at least technically - for the longs/buyers. And who knows how long that can last.
However, until then, the buyers are feeling uncomfortable, and I am not sure the negative story line (regulation, liquidity, "bad actors", taxes) are going away anytime soon.
Death by a thousand paper cuts is not a great way to go....
