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article imageBitcoin trading in a narrow range may breakout soon

By Ken Hanly     Jun 8, 2018 in Technology
Bitcoin has now been trading within a narrow range for over two weeks with low volatility. In the last 36 hours the price has not changed to any great extent.
Bitcoin (BTC) price could make strong move
Since the 24th of May a recent CoinDesk article points out, bitcoin has been trading within the $7,000 to $7,800 range but within the last day and a half the range is even tighter indicating an indecisive market most likely.
Daily volatility as measured by the daily spread between high and low fell to just $107.63 Thursday. This is the lowest level since way back on October 2, 2017. It is also down 86 percent from the 2018 average so far of $793 according to the CoinDesk Bitcoin Price Index.
As of the time of the article's posting at 10:48 UTC on Friday BTC price was $7,580 a drop of just $100 dollars over a 24 hour period.
Perhaps this is the calm before the storm as an extended sideways motion is often followed by a strong move up or down. According to technical theory the wider the range and longer the consolidation period the more likely is there to be a violent move up or down. A move of $800 in either direction could be expected soon.
Earlier this week bitcoin looked to be set up for a major upward move as there was an upside break of the falling channel. But the bulls failed to break through the $7,780 resistance level and has left it open for bearish tendencies to return. A downside break is the more likely of the two possible movements. The article notes that the price was dropping as it went to press.
The CoinDesk outlook
The CoinDesk analysis concludes: A move above $7,819 (50-week moving average) would signal a bullish breakout and would set the tone for a rally to pennant resistance located at $8,880. On the downside, a break below $7,090 (pennant support) would imply a bearish breakdown. In this case, BTC could potentially drop below $6,000 (Feb low)."
The present situation
The price of BTC opened at $7,688 and rose to a high of $7,694 before dropping back to a low of $7,544. The price has now reached back up to $7, 645 at 16:30 UTC. So far there is no sign of a clear break in either direction as the drop was reversed. However there are still another 7 plus hours left in the day. The present price of BTC can be found here.
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