Bitcoin/USD daily basis
Bitcoin USD - Price dump brings Bitcoin back to around 10'000 USD
After a significant decline in the previous week, the reporting week was characterized by consolidation at the new level of USD 10,000. For the most part, this took place above the USD 10,000 mark. At the beginning of the week, the strength of the market was tested below the 10,000 mark. The Bitcoin price reached its lowest point just below USD 9,000, with the main trading activity taking place above the USD 10,000 zone. The second half of the week was characterized by slightly rising prices. On Sunday, the price was rejected after reaching a weekly high of USD 10,600, which brought it back to its previous weekly trading level of USD 12,500.
Test of the newly created support
Review Daily Interval
A veritable countermovement established itself after the price dump in mid-March. This led up to the resistance zones starting at USD 10,000. After a renewed rejection at the beginning of June, an almost two-month consolidation was observed. This was characterized by a series of higher daily lows and lower daily highs. The series of lower highs was broken on 22 July. This was followed on July 27 by a break through the resistance zone around USD 10,500, which has been established since August 2019 and which Bitcoin has already failed to break several times.
The resistance zone around USD 10,000 was interesting in several respects. On the one hand, the 0.618 Fibonacci point (1) of the entire downward movement, which was established in the end of June 2019 just below USD 14,000, is located here. On the other hand, the zone around $10,000 also served as a confirmation of the still bearish trend of lower highs since December 2017 (see next section). This zone now counts as a significant support (green).
Outlook
Bitcoin is currently testing the newly created support in the 10,000 USD range. This zone serves as an important pillar of the positive trend. The next few days will give a first indication of the market's willingness to defend this support. Resistances are thus new at 11'000 and still present at the meanwhile well known zone above 12'000 USD (red). This is significant and still serves as an indicator if the market is serious about the recent trend reversal.
Should the USD 10,000 fall, further support is expected below USD 9,500 from trading activities from the end of April to mid/end of July 2020 (green). The 200 daily average is now located in this area (2). In such a scenario, a longer-term consolidation in the USD 9,000 - 11,000 range is expected.
Macro: Series of lower highs broken since end of 2017
Bitcoin was able to set a higher high in the weekly interval for the first time, breaking the prevailing bearish trend since December 2017. The series of lower highs, which lasted for 135 weeks, was thus interrupted (marker).
In order to change the negative macro picture into a valid trend reversal, the breakout should be legitimized by several weekly candles above the USD 10'000 mark.
An establishment above USD 10'000 and a consistent overcoming of the resistance around USD 12'000 over the next weeks/months speak for a legitimacy of the trend reversal. If the Bitcoin exchange rate can then consolidate above USD 12,000 again, the chances of an attack on the all-time high of a USD 20,000 would certainly exist.
A drop in the price, which would bring the price back into the USD 9,500 range and below over several weeks would damage the positive momentum and would speak for a longer-lasting consolidation.
Haftungsausschluss
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Risikohinweis
Anlagen und Investitionen, insbesondere in Kryptowährungen, sind grundsätzlich mit Risiko verbunden. Der Totalverlust des eingesetzten Kapitals kann nicht ausgeschlossen werden. Kryptowährungen sind sehr volatil und können daher in kurzer Zeit extremen Kursschwanken ausgesetzt sein.
