Bitcoin – A Shift in Sentiment or a Reversal to Come

Bitcoin rallied 6.12% on Friday, reversing Thursday’s 4.45% slide, to end the day at $6,208.1, leaving Bitcoin down just 1.07% for the week.

A relatively range bound morning and majority of the afternoon saw Bitcoin buck the broader market trend, with a mid-morning pullback to an intraday low $5,780 holding above the day’s first major support level at $5,731.43 and, more importantly, avoided striking a new swing lo.

While the broader market was recovering from morning reversals, a broad based market rally late in the day saw Bitcoin rally through the day’s first resistance level at $6,080.03 and second major resistance level at $6,299.77 to an intraday high $6,302 before easing back to $6,200 levels at the day’s end.

The moves through the day will have given the Bitcoin bulls some much needed relief, though the with the rally coming without the influence of any materially positive news, whether Bitcoin can hold on to Friday’s gains and make a run at $7,000 levels to form a near-term bullish trend remains to be seen.

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At the time of writing, Bitcoin was up 3.22% to $6,407, with Friday’s late in the day rally spilling over to the early hours of this morning, leading Bitcoin through the day’s first major resistance level at $6,413.4 to a morning high $6,545.5 before easing back to $6,400 levels, the day’s first major support level a $5,891.4 left untested through the early hours.

For the day ahead, a move back through $6,500 levels would support a run at the 23.6% FIB Retracement Level of $6,757 that would certainly consolidate Friday and this morning’s gains, barring the release of negative news on the wires. Drawing in side lined investors could be a challenge however, with investors sitting back waiting on governments and regulators to roll out crypto regs this month.

Failure to move back through to $6,500 levels could test investor resolve later in the day, with a pullback through a start of the day $6,195.2 low likely to see Bitcoin slide to test sub-$6,100 support levels before any recovery. We would expect the day’s first major support level at $5,891.4 to remain untested through the day however, barring particularly negative news hitting the wires, with the best outcome for the Bitcoin bulls being a consolidation at around $6,500 levels through the day.

Elsewhere, all the majors were in positive territory through the early hours, with Cardano’s ADA, Bitcoin Cash and Stellar’s Lumen leading the way, with gains of 5.95%, 5.35% and 5.08% respectively, at the time of writing, the majors having pulled back from an early morning spike that had provided investors with an opportunity to lock in profits for the week.

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