Bitcoin – Dominance Begins to Rise as Others FalterBitcoin on the rise early, though holding on to $6,300 levels will be key in the early part of the day to avoid a pullback later in the day.
Bitcoin gained 1.24% on Sunday, following on from Saturday’s trend bucking 1.5% rise, to end the week down 10.2% at $6,310.1.
A late Saturday reversal continued into the early hours of Sunday morning, with Bitcoin pulling back to a start of a day intraday low $6,162 before recovering to $6,300 levels, the day’s low steering clear of the first major support level at $5,998.23 and more importantly sub-$6,000 levels.
Through a choppy afternoon, Bitcoin broke through to $6,400 levels, with an intraday high $6,499 seeing Bitcoin test the day’s first major resistance level at $6,489.63 before pulling back to $6,300 levels.
While there was no major weekend rally to speak of, the gains over the weekend cut the deficit for the week and of greater significance was the clear level of support at sub-$6,300 levels, any pullbacks to $6,100 levels being short lived, leading to recoveries to $6,300 levels on each occasion.
In spite of the support, Bitcoin continued to fall well short of the 23.6% FIB Retracement Level of $6,757 and $7,000 levels needed to begin a near-term bullish trend formation, with the markets yet to fully dust off the recent negative news to hit the wires.
For the broader market, it was a particularly tough week, Bitcoin’s dominance rising from a start of a week 47.3% through to 51% at the time of writing, with the cryptomarket total market cap sliding from $259.99bn to a low of $206.97bn before recovering to $214bn levels.
The Bitcoin bulls will be fully aware of the rise in Bitcoin dominance over the week, reflected in the minor losses relative to the broader market, the support for Bitcoin certainly evident over the weekend.
On the news wires, there was no materially negative news over the weekend, supporting Sunday’s gains though we can expect the regulatory chatter to return following a couple of weeks of relative silence.
At the time of writing, Bitcoin was up 0.59% to $6,351, some early support seeing Bitcoin recover from a start of a day $6,306.8 low to an early morning $6,380 high, before easing back, the early moves leaving the major support and resistance levels untested.
For the day ahead, a move through to $6,380 would support a run at $6,400 levels to bring the first major resistance level at $6,485.4 into play, with the Bitcoin bulls eyeing Sunday’s $6,499 high, though the news wires will need to remain friendly to support such a move.
Failure to move back through to the morning high would likely test support later in the day, any pullback to sub-$6,320 levels likely to see Bitcoin pullback to $6,200 levels, while we would expect Bitcoin to avoid testing the day’s first major support level at $6,148.4, barring materially negative news hitting the wires.
Holding above $6,220 would be key to avoiding a pullback to sub-$6,200 levels later in the day, in the event of a broad based market sell-off.