Bitinstant CEO Charlie Shrem has been arrested today in New York and charged with conspiring to commit money laundering. Well i think that we have just seen a strong shakeout after a bearish news for bitcoin (actually i consider it a positive news, i don’t like to see bitcoin associated to criminal like money laundering) with a sudden move down to the second deviation line of VWAP at 750 dollars.

I don’t think this news is enough to sink this market to much lower price levels, the congestion phase should continue with the short term VWAP moving average acting as resistance, now at ~$830.

I pointed out in the attached chart several occasions where BTC/USD failed to move above my reference moving average confirming the weakness of this market. The Net Volume activity was positive but turned negative after the news came out this morning.

We are in a price congestion and as long as the market stays inside my trading rage of $760-$920 the considerations i’ve made in my previous update are still valid and don’t forget that good resilience against bad news is always a positive sign.