After a nondescript weekend whereby Bitcoin traded in relatively narrow ranges on a slight path of recovery, Monday trading seems to be displaying the intent of bulls to recover lost ground and reclaim USD 12,000.
That resistance level will prove to be quite strong, however, as the last time this year bulls rose past that, they actually roared past and touched USD 13,800, only to fall back spectacularly in a major retracement. However, there does appear to be some solid support at USD 11,000 anyway, as yesterday’s sellers could not break past that floor, while today’s bears in late North American trading could only push price down to the 24-hour low of USD 11,154, and that only for a couple of hours.
The most significant move today took place at 8:45 am UTC (Coindesk), as a belated London flurry of buys broke past existing order books at USD 11,400, taking price levels immediately upwards to USD 11,800. Since then, long traders have been enjoying gradually rising demand, and Bitcoin is now trading at its July highs very close to USD 12,000.
However you look at it, an almost 6% increase over the past 24 hours should provide some impetus for European bulls and speculators across the pond when they start trading in a few hours, to try complete this current march out of the trenches.
— TechNoobs (@Tech_Noobs) July 8, 2019
They will also take a lot of positivism from the fact that “bad news” no longer negatively impacts crypto price as easily as it used to. Just yesterday, new European Central Bank boss Christine Lagarde — the former IMF chief now replacing outgoing president Mario Draghi — had just issued a fresh warning that cryptocurrencies had inherent instabilities.
Earlier this year, speaking with an IMF hat on, she said Bitcoin and crypto were “shaking the system“:
“I think the role of the disruptors and anything that is using distributed ledger technology, whether you call it crypto, assets, currencies, or whatever … that is clearly shaking the system… We don’t want to shake the system so much that we would lose the stability that is needed.”
All that talk has failed to dent the price action of the world’s most traded digital asset so it could be seen as an opportunity rather than a threat, since ECB and other central banks in the world might be forced to take up a friendlier approach to Bitcoin and other crypto, knowing that the system is being disrupted, whether or not the traditional system likes it.
If they do, they won’t be the first crypto skeptics to change sides. Just last week, even Peter Schiff, gold advocate and long-time Bitcoin critic, received donations from Bitcoin users, leading to even he himself admitting that he might as well “hodl” the crypto he now owns.
Mark Mobius, the cofounder of Mobius Capital Partners and a genuine personality in the world of investment, was another high-profile wealthy person who has turned sides, from once calling Bitcoin a “real fraud” to now declaring it is “alive and well” and will continue to be so.
So if the net effect of high-profile investors and financial figures only means Bitcoin still goes up in price, then optimists will believe that when the tide of sentiment properly turns, a certain rally should happen.
If current parabolic phase is violated, we could expect either an 80% correction of 7-month advance or much smaller correction w/ definition of new parabola w/ shallower slope. $BTC Note formation of possible 2-wk H&S or H&S failure pic.twitter.com/6IF1bHREAv
— Peter Brandt (@PeterLBrandt) July 7, 2019
Of course, the permabears themselves have yet to give up on their doomsday analyses. Veteran crypto trader Peter Brandt himself paints a gloomy scenario that could set in as a result of its swift move to USD 13,868 last month. He believes that a fast and painful reversal could result in a fall all the way back to USD 3,000, the low of the year. He says:
“If current parabolic phase is violated, we could expect either an 80% correction of 7-month advance or much smaller correction w/ definition of new parabola w/ shallower slope.”
The only silver lining there, though, is that this is actually a worse-case scenario, so it doesn’t seem so bad for Bitcoin to reach the same depths it has already hit only half a year ago.
For the time being, however, there are some things to watch out for. The next few hours will probably see Bitcoin march past USD 12,000 but it will be a long 24 hours to see if a breakout can happen as hourly charts do seem to be vague about any symmetrical triangles. If the breakout does happen, it would have to be at high volumes to invalidate lower highs patterns, otherwise, we should see another retracement and further confirmation of a slightly overbought conditions that relative strength index (RSI) indicators are now beginning to show on a weekly chart, creeping over 80 RSI now in the past few hours.
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