As volume begins to build on the CBOE futures contract following the holiday period, it was the buyers who stepped in yesterday to help drive Bitcoin back over the $15,000 level, with the $15,500 level now fast approaching. For much of Wednesday, Bitcoin futures oscillated around the VPOC, and denoted with the yellow dashed line, as market participants reached price agreement in this region, marked with the highest volume on the 60 minute chart.
Then as markets moved into early trading yesterday, Bitcoin futures fell over $1000 in a six hour period, before the buyers stepped in at 9.30 am UK time on the hammer candle at the bottom of the price waterfall, as shown with the ultra high volume. Further buying then followed as the mopping up process absorbed the selling pressure, before rising steadily on good volume and propelling the cryptocurrency back over the $15,000 area to currently trade at $15,180 against the US dollar.
The technical resistance level is now clearly defined in the $15,500 region, and if this breached on good volume, then we can expect to see further gains for Bitcoin and indeed many of the other cryptocurrencies in due course, with Ripple and Litecoin following suit. The Trend Monitor continues to remain blue in this timeframe confirming the bullish sentiment at present.
By Anna Coulling
Bitcoin futures contract from CBOE
Charts from NinjaTrader
What VPOC means? What plattform do you use that allows see volume zone? I use ThinkorSwim whitaut this functionality?
“Without” instead of “whitaut”. Sorry
Hi Luis – no probs:-)
Hi Luis – thanks for your comment and the VPOC is short for Volume Point of Control – this is the area on the chart with the highest concentration of volume, and where buyers and sellers have reached price agreement. Once bullish or bearish sentiment prevails, the price then moves away from the VPOC, and develops to the next level with the VPOC istelf moving in due course as markets moves into congestion once more. The high volume and low volume nodes above and below then provide clues as to how the price action will develop as it approaches these regions. At low volume nodes price is likley to move through quickly whilst at high volume nodes, expect the price to congest at these points. The platform is NinjaTrader and the indicator is from Quantum Trading – you can find more details there, and is available for MT4 and MT5 and NinjaTrader.