Bitcoin Pulls Back Again
We are essentially in “crypto winter”, so I do believe that we still have plenty of time to build up quite a bit of a position for the next major rally.
- The BTC/USD currency pair fell a bit on Tuesday as the market continues to pay close attention to the $24,000 level just above.
- That area has been resistance several times, so it makes sense that we will continue to see selling pressure.
- Even if we were to break above that, it does not necessarily change the trend of Bitcoin, as there are plenty of resistance barriers above that you would have to take a look at.
If the market were to break above the $25,000 level, it would have to deal with the $28,000 level. The $28,000 level was the bottom of overall consolidation previously, so it does make sense that you would look at that as a major barrier. That barrier then would be where I determined that the trend has changed. We would have to get above the $32,000 level to confirm it for a longer-term move.
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This is not to say that you cannot be a buyer of Bitcoin on dips, but you need to be cautious about how you jump into the market. You don’t want to buy all of it here, because if we pull back from here, it’s likely that there will be buyers from time to time. I do believe that most people think that Bitcoin is going to continue higher and see more use over time, but that does not necessarily mean that it has to be reflected in the price right now.
The 50-day EMA currently sits at the $23,000 level and is rising. However, if we do break it down below there, then it’s likely that the market could go to the $20,000 level. The $20,000 level course will be a large, round, psychologically significant figure. Breaking down below that area then opens up the possibility of the Bitcoin market dropping down to the $12,000 level. That’s where the entire move higher began, and therefore it would be a complete “round-trip.” At that point, I think we would go sideways for the longer-term, and probably open up the possibility of a longer-term base-building opportunity. We are essentially in “crypto winter”, so I do believe that we still have plenty of time to build up quite a bit of a position for the next major rally. That being said, look for value and take advantage of it.