8-7-2015, Bitcoin weekly wrap-up. Still inside channel, volume diminished
Looking at the chart below, we are well within the channel between 220-310. This is a huge price channel, the bulls and bears can't decide which way it should go. After the spike to 315 from two weeks ago, volume has diminshed in recent weeks. Looking at BFX swap data, USD margin is at 30million while BTC swaps are at very low ~9000BTC. Longs are aggressive while shorts are scared. It is difficult to tell if longs are extended here since we are not able to make new highs with higher USD swaps.
On shorter timeframe, we have a pennant on the weekly/daily on my second chart. Generally, pennants and flags are bullish as a continuation pattern. So if we breakout above the descending resistance line, it is bullish. My only concern is that a consolidation pattern is generally low volume low volatility until a breakout. The current pennant has a really wide price swing which may not be as reliable. I say this from experience and from Tom's work about pennants:
A tight pennant performs better than a loose one. A loose pennant is one in which price meanders, pokes outside the trendline boundary, contains white space, or looks jagged. The Tight v. Loose figure to the right shows an example. -Bulkowski