Bitcoin – A Breakthrough to $3,700 Levels Needed to Avoid a RoutThe bulls will be targetting a move through to $3,700 levels. With resistance on the higher side, being able to hold on will be of greater significance.
Bitcoin slipped by 0.26% on Thursday. Following on from a 0.76% decline on Wednesday, Bitcoin ended the day at $3,656.7.
A mixed start to the day saw Bitcoin break through the first major resistance level at $3,728.67 to strike a morning high $3,750. Unable to hold onto $3,700 levels, Bitcoin slid to a late morning intraday low $3,640 before steadying.
Steering clear of the first major support level at $3,617.27, Bitcoin managed an afternoon high $3,681.9 before easing back. For the bulls, $3,700 remains the line in the sand, with Bitcoin failing to wrap up the day at $3,700 levels for a 4th consecutive day.
It was red across the board for the top 10. Leading the reversal through the day were EOS and Tron’s TRX. The pair ended the day with 3.75% and 3.15% losses respectively.
Litecoin’s more modest losses on the day led to a return to the number 4 spot by market cap, EOS seeing 2 consecutive days of heavy losses partially reversing solid gains through the first 2-weeks of February.
There were no major news events throughout the day to weigh on Bitcoin and the broader market. The lack of news has ultimately led to a downward trend following last week’s broad-based crypto rally on Friday.
The markets will be looking ahead to the SEC’s scheduled decision on the VanEck Bitcoin ETF. Of interest will be whether the SEC will delay the decision further. The lack of upward momentum suggests that few are expecting an approval and, perhaps of greater significance, a sudden redirection of institutional money away from the mature asset classes.
Insurance companies and pension funds, barring the odd exception, will likely be some way off investing into the world of cryptos. Not only is the issue of custody still unresolved, but volatility remains a concern and then, there is the ongoing investigation into the 2017 rally and the risk of price manipulation.
The good news is that Fidelity is scheduled to roll out its Bitcoin custody services in March. Perhaps there is an incentive for the SEC to push back for just one additional month, assuming the Department of Justice concludes its investigations and there is some greater clarity on what rules and regulations will be introduced by the G20.
At the time of writing, Bitcoin was up 0.53% to $3,676.1. A bullish start to the day saw Bitcoin rise from a morning low $3,652.0 to a morning high $3,695.7 before easing back.
While steering clear of the first major support level at $3,636.83, Bitcoin managed to break through the first major resistance level at $3,679.73 before easing back. Resistance at $3,700 pinned Bitcoin back in the early hours
For the day ahead
A hold onto $3,670 levels through the morning would support another move through the first major resistance level at $3,679.73 to bring $3,700 levels into play. Support from the broader market would be needed for Bitcoin to take a run at the second major resistance level at $3,702.77, while we would expect Bitcoin to fall well short of this week’s high $3,753.5.
Failure to hold onto $3,670 levels could see Bitcoin end in the red for a 3rd consecutive day. A fall through the morning low $3,652 would likely see Bitcoin call on support at the first major support level at $3,636.83 before any recovery.
Barring a broad-based crypto sell-off, we would expect Bitcoin to steer clear of sub-$3,600 levels on the day.