Bitcoin
has displayed a remarkable resilience to lots of negative news like the
regulatory crackdowns or the more hawkish interest rates pricing. Despite
everything that has been thrown to it, the cryptocurrency remains strong and
it’s even targeting a new higher high. Looks like only a recession or a very
hawkish Fed can stop bitcoin from reaching new highs, but even if we see a
selloff to either of those scenarios, we are likely to see a much stronger
rebound once the Fed starts cutting interest rates.
Bitcoin Technical Analysis
– Daily Timeframe
On the daily chart, we can see that after breaking
out of the trendline, bitcoin
rallied strongly to the 31K high where it found resistance. This
will be a key level to watch because a clear break to the upside should open
the door for a rally towards the 45K level. The sellers are likely to pile in
here with a defined risk above the resistance and target the 25K support.
Bitcoin Technical Analysis
– 4 hour Timeframe
On the 4 hour chart, we can see that bitcoin has
been struggling a lot to break above the resistance and this has led to a
consolidation just beneath the level. We now have a support zone at the 29500
level and a resistance at the 31000 one. The best strategy in such cases would
be to wait for a clear breakout and ride the following momentum. One can also
“play the range” though buying at support and selling at resistance.
Bitcoin Technical Analysis
– 1 hour Timeframe
On the 1 hour chart, we can see more
clearly the rangebound price action. At the moment the price is making lower
lows and lower highs after the rejection from the resistance, and the moving averages are
crossed to the downside. The sellers are in control in the short term so the
target should be the 29500 support. If we see a break to the upside though, we
can expect new higher highs and the buyers piling in aggressively.
Upcoming Events
In the next days we will have some top
tier economic indicators like
the US Jobless Claims and ISM Services PMI tomorrow and the main event of the
week: the US NFP report on Friday. Strong data should lead to a more hawkish
pricing for interest rates and weigh on bitcoin, while negative readings should
support the cryptocurrency as the market is likely to price in a more dovish
path for interest rates.
This article was written by FL Contributors at www.forexlive.com.