Bitcoin – Back into the Tight Ranges. We’ve Been There Before…

Bitcoin’s struggles at $3,600 hit a 3rd day, with resistance pinning Bitcoin back in the early hours. We’ve seen tight ranges end in disaster for the bulls.
Bob Mason
Bitcoin Crash

Bitcoin slipped by just 0.19% on Monday, following on from a 4.7% slide on Sunday, to end the day at $3,579.4.

A relatively range bound day, synonymous with recent market sell-offs, left Bitcoin at $3,500 levels by the day’s end for a 2nd consecutive day, as the bears continued to dictate the markets, evidenced by Sunday’s reversal.

Recovering from a morning low $3,555.3, Bitcoin managed to break through to $3,600 levels and strike an early afternoon intraday high $3,620.1 before sliding back, resistance at $3,600 pinning Bitcoin back from any run at $3,700 levels and the day’s first major resistance level at $3,741.0.

A late in the day intraday low $3,548.3 saw Bitcoin steer clear of the day’s first major support level at $3,487.10 and, of greater significance, sub-$3,500 levels that were last visited back on 17th December.

While Bitcoin saw red on the day, a move that tends to spell trouble for the week ahead, a number of the top 10 cryptos saw green, with 2019’s trailblazer Tron rallying by 7.90% to lead the way. While in the green, Ripple’s XRP and Litecoin’s less than 1% gains on the day were insignificant, as Tron continues to draw attention following recent news of its platform successes.

On the downside, Stellar’s Lumen had the heaviest losses, down 1.73% for the day, with Bitcoin Cash ABC and Ethereum not far behind, the pair down 1.65% and 1.35% respectively.

For Ethereum, news of the delayed system upgrade from 17th January being rescheduled for 27th February failed to spur a rebound through the day, the upgrade named Constantinople having been developed to shift Ethereum’s consensus algorithm from Proof-of-Work to Proof-of-Stake.

As Proof-of-Stake is considered to be more energy efficient, transaction fees are anticipated to be lower, which would be Ethereum positive. Another positive, from a price perspective, is the team’s decision to leave out the EIP1283 that had been discovered to be faulty, leading to the delay.

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At the time of writing, Bitcoin was up 0.07% to $3,581.9, with moves through the early morning seeing Bitcoin rise from a start of a day morning low $3,579.3 to a morning high $3,611.0 before easing back.

Steering clear of the first major support level at $3,545.10, Bitcoin came within range of the first major resistance level at $3,616.90 before sliding back to sub-$3,600 levels, Bitcoin struggling at $3,600 following Sunday’s sell-off.

For the day ahead, a move back through to $3,590 levels would support another run at the first major resistance level at $3,616.90, with support from the broader market needed for Bitcoin to take a run at the second major resistance level at $3,654.4. Monday’s high $3,620.1 and the bearish sentiment across the broader market will likely pin Bitcoin back on the day, to leave $3,700 levels out of play, in the event of a rally.

Failure to move back through to $3,590 levels could see Bitcoin hit reverse later in the day, a pullback through the morning low $3,579.3 bringing the day’s first major support level at $3,545.10 into play. Barring a major crypto sell-off, we would expect Bitcoin to steer clear of sub-$3,500 levels, with the second major support level at $3,510.80 there to prevent heavier losses in the event of a reversal.

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