Bitcoin (BTC) is currently trading at around $8,106 following a 5% jump in price since Friday.
Over the past 24 hours, the price of BTC has hardly moved as the world’s largest cryptocurrency attempts to break through and consolidate above its 200-day EMA.
Following some positive price action last week, some are suggesting that the bear market may be over and Bitcoin will keep pushing higher again.
Let’s take a look at Bitcoin’s chart, courtesy of TradingView.
As you can see, Bitcoin is bouncing off its 200-day EMA as it attempts to break this crucial level of resistance around $8,200. This is the important initial step BTC must take if it is to start recording consistent higher lows.
Over the last quarter of 2019, Bitcoin’s volume was showing signs of weakness. During most of Q4, volume stayed below $20 billion.
However, since late December, BTC seems to be turning things around, with volume currently about 30% to 40% higher than last month.
After the last drop that took BTC from around $7,500 to $6,900, price bounced and started climbing upwards.
If Bitcoin is able to maintain the positive trend seen so far this year, we might see $10,000 sooner than expected.
The current Bitcoin trend
Last week, I underlined that within the next few days/weeks, we could see a major reversal after a period of serious accumulation by ‘hodlers’.
The boost in trading volume means the accumulation cycle could be close to an end and the bull run we’re all waiting for will start sooner than expected.
For the time being though, there’s a chance it can go either way. Only if BTC continues to record higher lows will price continue to go up.
The upwards movement over the past few days could mean a shift in sentiment, but it is too early to tell. It seems we already found the bottom (during 2019) and could be making our way towards a mid-term move to the upside.
I expect price to bounce between the 50-day and 200-day EMAs until we see a serious break to the upside. At the moment, I expect BTC to trade between $7,700 and $8,200, as there’s strong resistance around this key level.
To break the 200-day EMA, BTC will have to go past some serious volume levels. I personally see massive resistance at around $8,200 and again near $10,000.
Will the trend reverse soon?
As veteran traders and investors usually say, smart money “buys when there’s blood on the streets”. I’ve been saying for the past month that I’m waiting for major drops to make new entries. Moments like these are highly welcomed and appreciated.
I strongly believe Bitcoin to be a long-term store of value, especially as traditional markets continue to show weaknesses.
How can the markets continue to push higher after the ECB’s recent rate cuts, the continuous share buybacks from huge corporations, or the inverted bond yield shoving investors away towards riskier assets?
In addition, repo market activity – as in loans from central banks to commercial and investment banks – has spiked to new monthly records. That adds up to another signal of weakness for the general economy.
We shouldn’t forget that the Bitcoin halving is coming in May 2020, which will put extra positive pressure on price as the number of Bitcoin minted per block is halved.
The key aspect of the halving event is to work out whether it has already been priced-in by miners. I personally doubt it, since most people (and businesses) have a short-term mindset.
Therefore, I see miners pushing for lower prices until the halving takes place. The harder it is to mine until the halving, the more miners will drop off, leaving more room for profits for the players who stay.
In conclusion, investors and traders should pay attention to the overall economic panorama, as it will most likely be a major catalyst for worldwide BTC adoption.
Current live Bitcoin pricing information and interactive charts are available on our site 24 hours a day. The ticker bar at the bottom of every page on our site has the latest Bitcoin price. Pricing is also available in a range of different currency equivalents:
US Dollar – BTCtoUSD
British Pound Sterling – BTCtoGBP
Japanese Yen – BTCtoJPY
Euro – BTCtoEUR
Australian Dollar – BTCtoAUD
Russian Rouble – BTCtoRUB
In August 2008, the domain name bitcoin.org was registered. On 31st October 2008, a paper was published called “Bitcoin: A Peer-to-Peer Electronic Cash System”. This was authored by Satoshi Nakamoto, the inventor of Bitcoin. To date, no one knows who this person, or people, are.
The paper outlined a method of using a P2P network for electronic transactions without “relying on trust”. On 3rd January 2009, the Bitcoin network came into existence. Nakamoto mined block number “0” (or the “genesis block”), which had a reward of 50 Bitcoins.
More Bitcoin news and information
As with any investment, it pays to do some homework before you part with your money. The prices of cryptocurrencies are volatile and go up and down quickly. This page is not recommending a particular currency or whether you should invest or not.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice.