Bitcoin Technical Analysis
The Bitcoin market rallied a bit during the early hours on Monday and therefore it looks like we are going to continue to see a lot of the back and forth and noise that we have been in for some time. With that being the case, the consolidation area looks very well guarded and the $60,000 level, and I think ultimately that is your floor in the market.
The 50 day EMA sits near the $62,000 level, and I think that’s also important. So, all things being equal, this is a market where anything can eventually reach its sorts at the top of the overall consolidation range, meaning that it could get back to the $72,000 level. That doesn’t mean that it’s going to be an easy move, just that it is a likely one.
With this being the case, I like the idea of taking advantage of short term dips and buying opportunities as clearly Bitcoin is in an uptrend. Speaking of the uptrend, we had gained 92% in six weeks. So that part of what we’re looking at here is a market that’s trying to absorb those gains. That’s not the type of behavior that can be constant.
Quite frankly, markets just can’t hold that type of volume. Ultimately, I think we may go sideways for a while as traders get used to the idea of an ETF, and we can see what institutions will actually use it for. With this, I think if we can break above the $74,000 level, then it opens up $75,000, followed by $80,000. On the other hand, if we were to break down below the $60,000 level, then we would reset and look for support near 52,000 regardless. I do think we will go higher.
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