Bitcoin – Stuck in a Rut, with the Bears Eyeing $3,700It’s a range bound start to the day, with Bitcoin continuing to struggle at $4,000. Investors could get edgy should Bitcoin ease to $3,800 levels.
Bitcoin fell by 1.09% on Saturday, reversing a 0.81% rise from Friday, to end the day at $3,911.9.
A bullish start to the day saw Bitcoin break through to $4,000 levels to strike a mid-morning intraday high $4,014.9 before hitting reverse, the day’s first major resistance level at $4,010.57 pinning Bitcoin back from bigger gains on the day.
The morning rally failed to draw in side lined investors ultimately leading to the reversal, with Bitcoin seemingly stuck in another rut, investors not needing too much reminding of the outcome to the October lull that ultimately led to Bitcoin shedding half of its value and raise the prospects of a slide through to sub-$3,000 levels before any bearish trend reversal.
As we have covered in previous articles, a number of market forces continue to support the extended bearish trend formed back at early May’s swing hi $9,999, including a DoJ investigation into the 2017 crypto rally, with any hints of price manipulation likely to give the SEC another reason to defer its decisions on the review of the Bitcoin ETF until the summer.
The only real good news for now is that Bitcoin has managed to steady following a particularly bearish 2018, though whether the bulls can take control and lead Bitcoin back through to $10,000 levels will largely be in the hands of the very governments and regulators that Satoshi Nakamoto looked to free investors from.
While the bearish trend remains intact across the broader market, Bitcoin’s dominance moving back up to 51.1%, a number of crypto majors have managed to buck the trend in recent weeks, with Ethereum in particular seeing substantial gains, up 91.3% from mid-December’s swing low $80.6.
The rebound has seen Ethereum recover its number 2 ranking by market cap, with hopes of a rebound in the ICO market, following the 2nd half of a year lull in 2018, providing much needed support.
Coming in behind Ethereum, but also noteworthy, has been Litecoin’s recovery from its mid-December swing lo $22.18, with Saturday’s rally giving Litecoin a 55.5% gain since mid-December, impressive when comparing to Bitcoin’s 2.7% gain over the same period.
A roll out of Ethereum and Litecoin swaps by crypto exchange OKEx and rising adoption for both cryptos has continued to drive demand, with the moves in the last few weeks delivering some degree of coin differentiation, which is ultimately key to the evolution of the market.
At the time of writing, Bitcoin was up just 0.15% to $3,917.9, with a relatively range bound start to the day seeing a morning high $3,938.4 and morning low $3,890.5 leave the major support and resistance levels untested early on.
For the bulls, a move back through the morning high $3,938.4 would bring the day’s first major resistance level at $3,984.2 and $4,000 levels into play before any pullback, with Saturday’s high $4,014.9 and the second major resistance level at $4,056.5 there to pin Bitcoin back from any attempted breakout to $4,100 levels.
Failure to move back through the morning high by the early afternoon could see Bitcoin pullback into the red, with a fall through the morning low $3,890.5 bringing the first major support level at $3,870.3 into play. For the bears, $3,700 would be the near-term target.