Bitcoin power continues overall
Bitcoin markets have enjoyed a major resurgence see over the last couple of months, and even the most bearish of analyst are starting to see the light. As for myself, I’m not necessarily a believer either, but price is price, and in the end that’s all that matters.
We have seen yet another breakout in the Bitcoin market, as the trading price is above $8600. Because of this, it now appears that the $8000 level should be your support level, and it probably extends down to the $7000 level from there. It in other words, we have a massive amount of support for a market that had been so brutalized last year. All things being equal, buying on the dip should continue to work, and I do think that we are heading to the next page around number: $10,000.
Money flowing out of China?
There hasn’t been a lot of this reported, but there are some suspicions that people are taking money out of the Chinese mainland via bitcoin again. Yes, the Chinese government did a lot to stem the flow of capital out of the country last time, but the pseudo-anonymity of the currency market will continue to attract a certain amount of money flow in those situations. There are other countries around the world in the midst of capital controls as well, so this may make the crypto market that much more attractive.
Is it a safety play?
It’s hard to imagine that crypto is suddenly a safety play again, but that may very well be the case. Quite frankly, stock markets have been slaughtered and the one exception might be the United States. That being said, crypto currency hasn’t exactly caught on in the US anyway. It is possible that people are buying Bitcoin simply to avoid taking losses with other types of asset classes or more specifically local currencies.
The main take away
At the end of the day, we can postulate as to all of the possible fundamental reasons that the market is going higher. The reality is that price is gaining, and if you are in the market to speculate, that’s all you need to know. Prices are moving from the lower left to the upper right, regardless of what any personal beliefs may dictate. For myself, I am not a crypto currency believer. However, the last thing I would do this step-in front of this and try to short what is obviously a Polish market. In the end, our job as traders is to make money, not trying to prove ourselves correct.
Until the market breaks down below the $7000 level, one would have to assume the pullbacks are going to be buying opportunities. Yes, I expect a major fight somewhere near the $10,000 level, and quite frankly would welcome it as the market simply cannot get as parabolic as it once was, otherwise it will end up doing the same thing as it did just a year and a half ago. So far, it seems to be steady and measured movements higher, which could give this market longevity.