Forget $10K, Bitcoin $12K Breakout Will Catch Everyone Off Guard
Is Bitcoin allergic to $10,000? Will we see a breakout in 2020 for BTC as this key level keeps being tested each week.
June 07, 2020
Forget $10K, Bitcoin $12K Breakout Will Catch Everyone Off Guard MARKET ANALYSIS
Bitcoin (BTC) price yet again surged past $10K for just a few hours before experiencing a short sharp 10% sell-off last week.
Each time this happens, crypto Twitter brings out the fanfare rejoicing at the fact that we’ve reached this psychological milestone. It's almost becoming too predictable, and that is exactly why the eventual breakout will catch everyone off guard.
So are there any signals that can help us determine when this might be? Let's take a look at the charts for the largest cryptocurrency by market capitalization, BTC.
Starting out on the monthly view, not much has changed since last week. Bitcoin is still hovering around .382 putting the next upside target at the 0.5 Fib of $11,891. Each time Bitcoin surges to the $10K zone, we experience a sell-off around $10,500, which we must first overcome before this can become a reality.
When you look at the historic monthly price action, we can see that last week was the third time that $10,500 was rejected. The question on my mind now is whether this will happen for the fourth time.
Taking a look at the orderbook for Binance, we can see large sell orders as denoted by the yellow bars. Previously, these were layered between $9,800 and $10,500. However, there are no meaningful orders at $10,500 anymore.
This could be an early indication that large sellers have a new target in mind, and as far as higher time frames are concerned, $11,800 and $13,900 are the next logical options based on previous monthly resistance and the Fibonacci levels.
Moving down to the weekly, and we can see that price is currently trending in an ascending channel, which mirrors the $10,500 monthly resistance as the midpoint of the channel, as well as the 382 Fib as the resistance of the channel.
To the downside, losing $9,000 would open up $7,600 as support based on the 236 Fib drawn on the monthly. To the upside, breaking $11,900 would open up the 618 target at $13,900, which has been a key resistance level on the monthly chart for quite some time.
Bitcoin is yet to trend in the upper half of this relatively new channel though, and with the support being tested last week, one would now want to see the weekly candle close above $10,500 before being particularly bullish.
Until this happens, one needs to remain neutral.
Moving down to the 4-hour chart for Bitcoin, I’m looking at the 236 and the 100% Fib retracement for support, which stands at $9,540 and $9,250, respectively.
However, the candles have been printing higher lows and lower highs for the last five days, which generally signals a continuation of a trend, and right now Bitcoin is technically still in an uptrend. But losing the 236, which we have just tested as I’m typing, would change the outlook for the week ahead.
Lastly, on the hourly chart, we have price trending downwards, with the MACD trending upwards, which signals bullish divergence, meaning a break to the upside is to be expected.
As such the bullish scenario of extending towards the first key resistance of $10,500 looks likely in the short term. Finally breaking out from this level would put $12K firmly within reach before experiencing heavy overhead resistance at $13,900.
https://cointelegraph.com/news/forget-10k-bitcoin-12k-breakout-will-catch-everyone-off-guard
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Topic: Forget $10K, Bitcoin $12K Breakout Will Catch Everyone Off Guard (Read 2854 times)