Bitcoin pulls back during Wednesday sessionBitcoin markets fell a bit during the day on Wednesday, although we did see a bit of a short-term recovery. In the end though, we have made a “lower low.”
Bitcoin struggle against the US dollar during Wednesday trading, which should not be much of a surprise considering that the US dollar has strengthened in general. The US dollar is the strongest currency in the world right now, and that of course will translate into the crypto currency markets, despite what many in the field think. After all, the US dollar is half of the trade. With this being the case, it’s going to be easier to trade Bitcoin against other currencies than the greenback, as it is sent to have strength over the next several weeks if not months. That being said, I believe that there is significant support below at the $8000 level, and it looks as if we may try to drift down to that level.
Bitcoin also fell against the Japanese yen, reaching towards the ¥900,000 level before bouncing to the ¥940,000 level. We have found resistance there, so it looks like we are rolling over again, offering a shorting opportunity. If we break down below the ¥900,000 level, and I think we may very well do so, we will probably go looking towards the ¥800,000 level next, followed by the ¥700,000 level which has been the bottom of the overall consolidation as of late. The obvious ¥1 million level above continues offer significant psychological resistance, so I don’t think we break above there in the short term.
Bitcoin has underperformed for some time now, and in less you are willing to hang on for months, if not years, this may be a market that it’s difficult to put a lot of faith into. Short-term trading is very difficult to do for more than a quick smash and grab trade, as the upward momentum seems to have been sucked right out of the market.