BTC Update Monday 5th August

When we last posted the bitcoin market was trading at $104 support and over a quiet weekend, nothing has changed.

Here's the chart:

As you can see, while the longer term trend is decidedly bullish, for the time being at least we are trading in a tight range and this puts the market into 'breakout mode'.

On the one hand, if new buyers continue to come in at these levels we are going to see the market pick up momentum with $112 very much in view.

Having said this the first move may be down and it wouldn't surprise us to see a fall to around $101 before the next buying wave triggered.  Any lower that here and $97 comes into view as bears gather confidence.

Essentially what we are seeing represents a classic consolidation phase within a trend and this can be unsettling for all participants.  It is a condition in which false signals can and will be thrown out.  While active traders may want to chance a short term play back down to lower support this is a risky counter-trend strategy which will bite all but the most attentive.

This in mind our advice would be to stay long until or unless we see a convicted break back through $97.