A quick flash crash and BTC/USD is again at around my static support,i think that this drop is temporary and i bet that the VWAP will provide support at 107$ for the coming days. I’m not going to close my half position (50 btc bought at 140$) before a price stabilisation that will occur probably somewhere between here and 105$.
If 105$ will not hold then there are the 2 deviation lines indicated in the chart, 85$ and 62$ where strong buyers will probably show up.

UPDATE October, 3
BTC/USD bottomed out at 109.7$ very close to the VWAP that provided support as i was expecting yesterday, the question now is whether this is a high volume breakout that portends much lower prices, or a high volume shakeout that will quickly be reversed. So far BTC/USD reacted from VWAP back to the first deviation line at 131$ and it is important now to don’t start to drift lower and lower in what i’ll call a secondary reaction that might end at 90$.

Since the market is still above an important moving average i’m plotting since july bottom at 65$ and trending higher since then, I am leaning towards the shakeout theory rather than toward the breakout theory. If I am right we shall see a rally back above the 131$ level during the next couple of days. Should we finish today or tomorrow above 140$ I think a substantial rally will have started.

As you can see from the attached chart on the left BTC/USD at gox is again probing the static resistance at around 147$.
It is clear from the chart that an ascending triangle pattern is forming with a projected target of 165$ that it’s exactly my long term target i’ve spoken about in this update . I think there is a chance to breakout September top at 149$ and reach 165$ or so during October.

I’m particulary happy of the recent news of a private Bitcoin Investment Trust for accredited investorst launched by Secondmarket, this might affect price significantly next year. Unlike the ETF that the Winklevoss twins have been trying to do, this one is only available to accredited investors and so it doesn’t have to pass the same exploratory process that a wider ETF would need to go through complex regulatory procedures. I can’t be sure but i smell a new big wave (the third after 2011 and 2013) of investors coming in 2014-2015, why? Well the bull market is coming to an end and instead of holding overvalued stocks many investors will eventualy explore new kind of investments like cryptocurrencies and Secondmarket Bitcoin Trust could be an easy gateway to invest in bitcoin.

Not much have changed in the last 7 days, this month tendency is obviously flat and not what i expect, basically the market is not going up as I would have hoped, I unfortunately bought on a false breakout of a strong resistance level and since then the market has been flat.

Short term picture is now a bit bearish because we are under this month VWAP (located at 137$) but still above the support at 125$. Before closing the position definitely i’ll wait to see BTC/USD under 125$ for at least one day.

After my previous update this market has recovered from the static support at 125$ back to 141$. With this reaction i’ve to conclude that it might move a bit higher over the coming weeks to my long term target of at least 168$. In addition, prices are holding above the short term VWAP and at least in the short term the situation remains bullish despite some bearish bias of my last update when i was a bit skeptic to see prices above 125$.

First resistance for this month is 147$ and support always at 126$ or so, if BTC/USD stays above VWAP at 137$ i’m not much worried for my trade opened at 140$.

I’d like to conclude this quick update talking about the complicated situation at Mt.Gox.
Frankly speaking i’m a bit worried of the lack of transparency and communication from MtGox, with the last official statement dated August 5, more then 40 days without any official news about the impossibility for who is requesting a wire transfer withdrawal from his account to be completed in a decent time frame and for “decent” i mean days and not months like now.
I have a friend that has been waiting so far more than 3 months since his initial withdrawal request, this is not acceptable, at a first glance i should say that this is a criminal behaviour but i don’t know all the details of what is going on at MtGox.
Aniway, the paradox is that this problem will increase the pressure on prices because the only way to withdraw money from MtGox is to buy bitcoins, this of course explain the price difference with btc-e and bitstamp exchanges. I dunno how it will end but one thing is sure, volume activity is dropping at MtGox and increasing on other exchanges and this is not so bad after all.

BTC/USD dropped down to the first support zone i’ve forecasted in my previous update, i’m continuing plotting the VWAP average and deviation lines since the last important bottom of July 5, as long as the price stays above the VWAP the cycle is still in the upward phase and no serious retracements are expected.

I think that probably the static support at 123$ will not hold and BTC/USD is going to retest the VWAP slightly above 100$ where a decent buying opportunity will materialize. As i’ve said buying at the breakout of the second price deviation line of the VWAP is a risky business thus i opened the trade with only 50 bitcoins leaving to me the option to average down my position once this retracement is completed.

UPDATE

The market is reacting from 125$, so probably my skepticism to see BTC/USD going under the static support at 123$ was a bit unjustified; for who follow on twitter my weekly range forecast  i revise this week range estimate to 125$-145$.

Not much has changed since my last update, BTC/USD is still above the short term VWAP and in the short term my bias remains mildly bullish despite since the beginning of june all were claiming as the truth their forecast of a new crash coming, a repetition of the 2011 pump and dump scheme or the collapse of the bitcoin economy:)

As a contrarian believer i consider this bearish crowd behavior among investors a confirmation to the fact that we are not going to see a repetition of the 2011 extreme bear market, instead a consolidation around 80$-100$.

In the meantime I think support beneath the market stands near the 80$-85$ support zone and it might be tested during this month; it could be a decent buying opportunity for all the investors interested to join the long term ride. Keep in mind that before reaching the support area at 85$ there is the average at 94$ providing good support and considering the current low volatility environment  it’ll not be easy to break that price level. No one is selling aggressively right now, this means we need higher prices to see bears coming.

Since my last update bitcoin tried to reach 122$ but it stopped rising  at ~104  just below the first price deviation line. I’m not happy about the missed move up to 120$ that i was hoping to see , once i saw BTC/USD failing miserably to go above 108$ i’ve immediately understood that there wasn’t enough fuel for a serious reversal; indeed, since that top, bitcoin stalled under 100$ and then dropped 10$ today. At this point i think that the downtrend resumed and the first level to test is 81$.

I continue to recommend to you guys to don’t invest at the moment, for who is already invested for the long term as long as BTC/USD stays above previous long term top (32$) it’s all fine but, for a better understanding of the long term outlook, i prefer to wait August that has been always a thougth month with high volatility; in 2011 a big drop, in 2012 the infamous pirate40 sell-off, thus it is not excluded a serious bottom next month.

The market is finally showing some bullishness but it is not enough for me to say that it is a long term reverse. After doing a bottom at 65$, just above the long term support i’ve indicated in my last update, it reacted nicely up to the resistance price zone i’ve previously forecasted, around 90$. I think that BTC/USD might reach 95$ and find strong resistance by the short term and long term VWAP, both standing there.

I’ve to add that my weekly moving average is at 97$, so it’s pretty normal a pull back up to it before resuming the downtrend. To conclude  i’m remain bearish and only strong buying pressure above 95$ would convince me of the contrary.

In case of a strong break out and the come back to triple digits the first resistance is around the first deviation line of my short term VWAP, it’s located at 108$ and then at 122$ the second one. So, first a break out of 95$ and then reach 108$, subsequent pullback for a retest of 100$ and then 120$ might be the first steps for a long term reversal.

OFF TOPIC
I’ve a domain for sale, http://www.bitchanger.com ;it might be the right name for a bitcoin exchange or whatever. I accept also offers in bitcoins.

This is a view of this month and it is visible that BTC/USD failed to go above the short term VWAP level at 112$ (now 111$); i’m worried of the recent weak behaviour and i’m starting to have concerns about the health of the long term uptrend but as i stated in one of my previous long term update i still think it’ll not go under 50$ this summer.

Again, in case of strength above the vwap level at 111$ i will change the short term outlook from bearish to bullish.  For now, i see the possibility to reach the 90$ support so to attract buyers and let BTC/USD rebound few $$.

This is a  view of last 30 days and not much happened in the last ten days since my last update.

BTC/USD is still fighting to go above the short term VWAP level at 112$ but at least we have had an higher low around last 14-17 June.

My view isn’t changed from the previous update, any strength above the vwap level at 112$ will change the short term outlook from bearish to bullish. Traders who want to anticipate the market for a quick profit would be wise to place the stoploss under 90$ and a possible take profit maybe at 122$ but it remains risky to buy with bitcoin still having difficulties to pass 112$.

This is a view of last 8 days, each bar represents 4 hours. VWAP levels and deviation lines are computed using last 40 days. I’ve closed my short term trade when BTC/USD dropped below my support level at 114$, after a strong sell-off the market found support at the second deviation line of the VWAP around 90$, the subsequent rebound should stop at the VWAP confirming the weakness of the BTC/USD pair. Any strength above the vwap level at 112$ could mean that the short term trend has reversed again, to the upside this time.