Crypto Market Flips Inexperienced — However Is Bitcoin Able to Retest $8,000?
On Dec. 4, Bitcoin (BTC) unexpectedly rallied arduous from $7,080 and over the subsequent 5 hours the digital asset had moved 9.92% to commerce for $7,788. The sturdy surge briefly broke the sample of decrease highs decrease lows. However by the tip of the day, the worth had retraced again to $7,100.
Crypto market weekly efficiency. Supply: Coin360
Bitcoin worth slowed down because it met resistance at $7,800 and was unable to set the next excessive above $8,000. Merchants will notice the excessive quantity nodes of the quantity profile seen vary (VPVR) at $7,850 and an excellent bigger one at $8,040. Provided that the worth stopped quick each these nodes, the subsequent push from bulls will must be stronger and with sustained quantity to beat this zone.
Finally, Bitcoin worth stays trapped under the long run descending trendline and since Jun. 26 there’s a clear sample of worth operating as much as the trendline, rejecting and falling into one other section of decrease highs.
BTC USD every day chart. Supply: TradingView
The scenario has been lower than ultimate for perma-bulls who’re lured into every massive worth drop beneath the idea that both a backside has been discovered or the latest drop presents a possibility to open a low leveraged lengthy place.
Many following this technique have both been stopped out, liquidated or went into the pink on their investments.
In the meantime, these taking part in either side of Bitcoin’s worth motion could have acknowledged that the present development of dropping to the decrease trendline of the descending channel is adopted by a robust oversold bounce that culminates with a brush in opposition to the primary descending trendline the place merchants could have opened shorts, which they journey again all the way down to decrease trendline. Wash, rinse, repeat.
BitMEX XBTUSD Liquidations chart. Supply: Skew.com
In line with knowledge from Skew Markets, yesterday’s surge liquidated almost $60 million in BitMEX leveraged positions. Extra information of the week that may weigh on investor sentiment was crypto Twitter chatter that Bakkt’s Bitcoin futures contracts are solely 37% backed by Bitcoin, reasonably than the lengthy purported 100% backing. Moreover, within the late hours of Dec. 4, crypto media reported that Bakkt CEO Kelly Loeffler is departing Bakkt to function a United States Senator representing the state of Georgia.
Absolutely this information doesn’t bode nicely for investor sentiment but it surely’s seemingly that the narrative will quickly shift to one thing alongside the strains of suggesting that Loeffler can advocate for crypto-supportive laws from her new place as a senator.
Concern & Greed Index. Supply: different.me
The Crypto Concern & Greed Index studying is again to “Excessive Concern.” Provided that buyers understand the indicator as a counter buying and selling sign, some will take a look at Bitcoin’s present worth motion as one other alternative to build up or no less than open lengthy positions. Threat-averse buyers will seemingly interpret the studying as an additional warning that Bitcoin worth might fall to new multi-month lows if it fails to carry $7,000.
At the moment, Bitcoin is trying to duplicate yesterday’s efficiency however is discovering resistance on the descending channel midpoint ($7,512), which additionally aligns with the shifting common of the Bollinger Band indicator.
BTC USD every day chart. Supply: TradingView
BTC Each day MACD chart. Supply: TradingView
Over the previous few days, the shifting common convergence divergence (MACD) indicator managed a bull cross and the histogram flipped constructive. However the present momentum leaves merchants eager to see extra quantity and vary in Bitcon’s worth motion because it has been unable to carry onto positive factors or maintain above the 12-period EMA.
At the moment, buying quantity is rising and if the worth can push above the Bollinger Band shifting common, Bitcoin might rise to $7,976.
BTC USD 6-hour chart. Supply: TradingView
As proven by the 6-hour chart, Bitcoin is displaying some bullish conduct. The 12-point exponential shifting common (EMA) is slowly pulling its method as much as cross above the 26-EMA and the worth is urgent in opposition to the $7,400 resistance. As noticed on the every day chart and talked about earlier, the MACD histogram continues to achieve momentum however extra buying quantity will likely be required to push Bitcoin worth via $7,400-$7,600.
BTC USD 6-hour every day chart. Supply: TradingView
The relative energy index (RSI) has climbed again into bullish territory and the Stochastic RSI is shortly rising towards 80. Merchants may also discover that the Bollinger Bands are tightening and the worth is barely above the indicator’s shifting common.
All of this means a bigger transfer is within the making and the VPVR reveals that worth might run in direction of $8,000 if bulls can press the worth via the zone talked about above ($7,400-$7,600).
A drop under $7,080 might see the worth sink to $6,800 and if patrons fail to purchase into the dip the worth might revisit the earlier double backside at $6,524. If bulls ignore this stage, then $5,250 is more likely to be the subsequent goal.
As proven by the every day chart and talked about in a earlier evaluation, the run-up from $4,000 to $13,800 was speedy and minimal assist was constructed from $7,200 to $5,300. So the worth might shortly slice via this zone if BTC worth drops under the descending channel assist.
The views and opinions expressed listed below are solely these of the writer (@HorusHughes) and don’t essentially replicate the views of Cointelegraph. Each funding and buying and selling transfer includes danger. You must conduct your individual analysis when making a call.