Bitcoin powers higher during very thin holiday trading
Bitcoin rallied again during the trading session on Thursday, as Americans celebrated Independence Day. We have hit the $12,000 level and pulled back slightly but quite frankly that’s not anything to be concerned about. This is an area that had been resistive in the past but we have also been above here so therefore the resistance will be somewhat minor.
Retest of resistance
The biggest thing on this chart is the fact that we have recently retest that previous resistance at the psychologically important $10,000 level. This happened on Tuesday as we formed a perfect hammer, and therefore showed signs of massive support. This is exactly what you want to see when you get this type of move. We have broken through what had been pretty difficult, but it turns out it was just as difficult to break down through as well.
Central banks continue to be one of the best friends for Bitcoin. After all, the biggest thing about Bitcoin at the moment is the fact that it’s not controlled by a central bank. I’m not talking about the libertarian ideals of it being “the people’s money”, rather that it is free of interest rate cuts and monetary policy easing as we are seeing around the world. With the Federal Reserve jumping into the fray, it makes sense that when measuring Bitcoin against the US dollar, it should rise.
Not only do we have the nice hammer bouncing off the previous resistance, proving it to be supportive, we ended up forming a bit of a flag like pattern as well. It’s a bit of a stretch to suggest that it’s a perfect flag, but it certainly is similar. With that in mind, it looks as if breaking above the $12,000 level will bring in fresh money. At that point, the most obvious area above to pay attention to the $14,000 level which of course was the most recent high.
The main take away
The main take away of course is that Bitcoin is in a bullish market. At this point it makes sense to continue to buy this market on short-term dips as it should offer value. After all, Bitcoin has the proclivity to rally over the last several months, so there’s no need to fight that trend. Ultimately, this market continues to be relatively one-sided, but that’s nothing new for cryptocurrency. It’s either all good, or all bad. As long as we can stay above the $10,000 level it’s very likely that the buyers will remain in control, and with central banks around the world looking to ease monetary policy, it’s a bit of a no-brainer.
Beyond that, money is flowing out of China again and has been feeding the crypto markets, a lease as best as we can tell. To the upside, the $14,000 level will be the initial target, but quite frankly $15,000 will be found shortly after that breakout. It looks as if Bitcoin is in a major bull run yet again.