Bitcoin – Bulls Manage to Hold on as Vol Creeps Back in

Bitcoin bounces back to ease near-term fears of a slide to sub-$3,000 levels, strong support evidenced by Tuesday’s moves.
Bob Mason
Bitcoin Newspaper

Bitcoin rose by 1.67% on Tuesday, following a 0.19% fall on Monday, to end the day at $3,639.1.

Off the back of a particularly range bound start to the week, which continued through the early hours of Tuesday, Bitcoin tumbled to a late morning intraday low $3,462. The sell-off saw Bitcoin slide through the first major support level at $3,545.10 and second major support level at $3,501.8 before recovering.

It was Bitcoin’s first visit to sub-$3,500 levels since 17th December and signalled, not only a pickup in cryptomarket volatility, but also a strong level of support for Bitcoin and the broader market, in spite of the return to tight ranges at the start of the year.

The Tuesday morning sell-off saw the total crypto market cap fall to $117.69bn before recovering to $120bn levels, with EOS and Tron’s TRX leading the rebound on Tuesday. EOS bounced back to end the day with a 5.27% gain, with Tron’s TRX enjoying a 2nd solid day, up 4.04% off the back of a 7.9% rally on Monday.

There was little coming from the news wires to deliver the late morning blow to Bitcoin and the broader market, with talk of Bitcoin being oversold at $3,500 levels contributing to the late morning bounce back.

While Tron’s TRX continues to buck the trend across the broader market, trailblazing its way through January, currently up 86%, the broader market looks to have reverted back to trend, a lack of differentiation across the cryptos creeping back into the market.

This could well shift once the Ethereum upgrade takes place in February. When considering a particularly weak start to the year for Ripple’s XRP, down 10.33%, some of the cryptos are certainly due for a bounce back, particularly when considering the successes that certain platforms have had over the last 12-18 months.

Get Into Cryptocurrency Trading Today

At the time of writing, Bitcoin was up 0.32% to $3,650.9, with moves through the early hours seeing Bitcoin fall from a morning high $3,661.1 to a morning low $3,631 .0 before recovering. Another range bound start to the day left the major support and resistance levels untested early on.

For the day ahead, a hold onto $3,600 levels would be needed to support a run at Tuesday’s high $3,682.1 to bring $3,700 levels and the first major resistance level at $3,726.8 into play before any pullback. Having failed to strike $3,700 levels for two consecutive days, support from the broader market would be needed for a break out from $3,600 levels later in the day.

Failure to hold onto $3,600 levels could see Bitcoin call on support at the first major support level at $3,506.7 before recovering, sub-$3,500 levels unlikely to be tested, barring a meltdown event later in the day.

For the crypto bulls, recovering to $3,600 levels on Tuesday was not just a positive for Bitcoin, but the broader market, with Bitcoin likely to take the rest of the majors with it if sub-$3,000 levels were hit.

Volatility appears to be back and we can expect some more choppiness today should the recent trend in volumes across the broader market continue.

Don't miss a thing!

Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All

Top Promotions

Top Brokers

The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.