Bitcoin – Bulls Continue to Struggle, as the Bears Target $3,500Bitcoin treads water early on in the day, while a number of the majors sit in the red, which could see another sell-off if Bitcoin returns to $3,600 levels.
Bitcoin slid by 5.55% on Thursday, reversing a 0.52% rise on Wednesday, to end the day at $3,712, the day’s loss a 2nd for the week to pull Bitcoin into the red for the current week.
Sentiment across the broader market darkened through the day, with Bitcoin coming up short of $4,000 levels for a 2nd consecutive day.
An early morning intraday high $3,968.8 came up short of the first major resistance level at $4,009.3, with Bitcoin falling to a morning low $3,820 to call on support at the first major support level at $3,831.4.
Range bound through the late morning and early afternoon, Bitcoin managed to move back through to $3,900 levels in the early afternoon before succumbing to a late in the day sell-off, Bitcoin sliding back through the first major support level at $3,831.4 and second major support level at $3,732.8 to an intraday low $3,686 before recovering to $3,700 levels.
There was nothing particularly negative on the news wires to drive the reversal and late in the day sell-off, with the extended bearish trend continuing to pin Bitcoin back from any kind of recovery.
Failing to move back through to $4,000 levels would have certainly led to some money coming off the table, with a fall through to sub-$3,700 levels bringing back the possibility of a near-term pullback to sub-$3,000 levels.
Thursday’s reversal saw Bitcoin’s dominance rise to 52.9%, with the total crypto market cap falling back to $120.63bn, the upward move in Bitcoin’s dominance beginning to signal another extended reversal, a move through to 55% levels considered a particularly bearish cryptomarket environment.
Bitcoin’s losses were minor relative to its nearest cryptos, with Bitcoin Cash ABC, Ripple’s XRP and Ethereum all seeing more than 10% losses on the day, a lack of momentum through the middle part of the week testing investor resilience going into the weekend.
At the time of writing, Bitcoin was up just 0.18%, with a relatively range bound start to the day seeing Bitcoin rise to a morning high $3,746.9 before easing back to a morning low $3,710.7, the day’s major support and resistance levels left untested early on.
For the day ahead, a move back through the morning high $3,746.9 to $3,790 would support a run at the first major resistance level at $3,891.87 to bring $3,900 levels into play before any pullback, though sentiment across the broader market would need to improve to support an afternoon rally.
While Litecoin and Ripple’s XRP are in the green at the time of writing, there’s plenty of red on the crypto board, which may ultimately lead to another Bitcoin reversal later in the day.
Failure to move back through the morning high could see Bitcoin pullback to $3,600 levels, which will likely get investors jittery, bringing the first major support level at $3,609.07 and $3,500 into play, while we would expect Bitcoin to steer clear of the second major support level at $3,506.13.
Bitcoin at $3,500 would certainly be a test for the Bitcoin bulls going into the New Year.