Bitcoin breaks down from weekly pattern coinciding with harsh comments from Wall Street legends
Bitcoin is weakening and has broken down from a rising wedge pattern on its weekly chart (aqua converging trendlines). We note the RSI is on the bearish side of 50 (green rectangle) and that the stochastic has turned down. If the stochastic makes it to its lower quintile and holds there (blue arrow), a bearish momentum will pressure the cryptocurrency.
The pattern breakdown coincides with strong comments at Saturday's Berkshire Hathaway annual shareholder meeting. First, Warren Buffet and Charlie Munger reiterated their criticism of the cryptocurrency. Buffet said, "Whether it goes up or down in the next year, or 5 or 10 years, I don't know. But the one thing I'm pretty sure of is that it doesn't produce anything." Then, less diplomatically, Munger maintained that "In my life, I try and avoid things that are stupid, evil and make me look bad in comparison to somebody else…and bitcoin does all three."
Senior Market Specialist
Russell Shor joined FXCM in October 2017 as a Senior Market Specialist. He is a certified FMVA® and has an Honours Degree in Economics from the University of South Africa. Russell is a full member of the Society of Technical Analysts in the United Kingdom. With over 20 years of financial markets experience, his analysis is of a high standard and quality.
Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interests arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed here.