The (Bitcoin) price continued to trend lower, with huge selling volumes on the Bitstamp exchange in the early hours of this morning. The price action has seemed to find strong support at the $366 level, however, the risks to the downside remain present. The price is currently trading 2.97% lower from today’s open, at $370.69. The first and second weekly support levels lie at $364.40 and $341.28 respectively. In the event of an upward reversal, resistance will be encountered at $414.32.
The Japanese government asked the Bitcoin community to form a self-regulating authority, called the Japan Authority of Digital Assets (JADA) and there is no proposed government regulation of JADA. The aims going forward for JADA are; make anti-money laundering and security guidelines, hold discussions with the government, help new digital currency companies and provide consultation regarding Bitcoin and digital currencies. The Liberal Democratic Party of Japan wants the country to be the friendliest towards Bitcoin and this development is the first step in that direction. 10-15 companies are expected to be initial members of JADA, with a projection of over 100 members in the next three years.
Debit Cards
The first Bitcoin debit card will be introduced by Alternet Systems in the US making it potentially easier for consumers to use their coins and ultimately boost the Bitcoin economy. It will be the first platform capable of exchanging digital and fiat currencies, via accepted mechanisms, in a format that provides immediate acceptance. Additionally, the system has been designed to adhere to Banking and Federal guidelines. Alternet Systems believes that digital currencies will play a key role in the future of money and banking across the globe.
The 4-hour chart below shows the price action along with the Ichimoku cloud indicator. The price action closed below the cloud last night and continues to trend lower, indicating the formation of a downward trend. Furthermore, the base line is above the conversion line, indicating bearish momentum. If the conversion line moves further below the base line, further price declines should be expected. The Ichimoku cloud should act as resistance going forward, at the $380-$385 level.
Relative Strength
The chart below shows the 4-hour price action and oscillator indicators MACD and the Relative Strength Index. The relative strength index is close to the oversold zone, which lies below 30, indicating that the price could fall further before buyers are bid back into the market. Also, the MACD does not indicate oversold conditions yet either. Furthermore, the height of the histograms are increasing, suggesting that the downward move is gaining momentum. Additionally, the price action should find support at the mid-$300 level and is likely to experience oversold conditions. At this level, a slight upward reversal is expected as buyers take advantage of lower prices.
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