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Bitcoin just closed the 3rd quarter of the year with its best-ever performance, marking the third of only three quarterly finishes over $10,000.

All good things come in threes, so here are three reasons why this the third time is the charm, and the cryptocurrency will hold strong above the clearly critical level.

Bitcoin Closes 3rd Quarter Above Resistance, Can It Hold Above $10K Support?

The first-ever cryptocurrency had a tremendous second and third quarter of 2020, after plunging to $3,800 as Q1 came to a close.

At the start of the year, Bitcoin once again flirted with $10,000 and held briefly before pandemic fears spilled over into markets.

Related Reading | How Bitcoin’s 2020 High Compares To Past Bull Market “Tops”

The recovery spread across the spring and summer months, but with fall here, that’s exactly what investors are hoping markets don’t do.

Bitcoin price closed Q3 above the key level of $10,000 – making it only one of three quarterly candles to do so. Neither time before has it been able to hold, but this time around, there are plenty of reasons to hope for the best.

bitcoin btcusd 3m quarterly

BTCUSD 3M Quarterly Close - One of Three Above $10,000 | Source: TradingView

Third Time’s A Charm: Three Reasons Why $10,000 Holds This Time Around

Continued retests of $10,000 and even a fall below it on daily, weekly, or even monthly timeframes cannot be ruled out, but there are several reasons why when the bell rings on Q4, Bitcoin price will be above $10,000.

For one, Bitcoin’s bear market is coming to a conclusion. A pandemic and widespread panic that tanked the stock market could not take the leading cryptocurrency by market cap to a lower low. The higher low could have in fact given bulls the confidence to push this high, and aren’t going to let the momentum slip.

Related Reading | Bitcoin Fundamental Expert: “Clarity” Comes After “Rocky” Election Ends

Even if some consolidation remains, unless a lower low is set, eventually Bitcoin price will make a new high. And the first step to that was closing the quarter back above $10,000 for the third time. A major support and resistance flip along with a breakout from the “meme” downtrend line from all-time high further add to the positive technical outlook.

dollar dxy

DXY Dollar Currency Index Breaking Down On High Timeframes | Source: TradingView

The next major reason for the cryptocurrency rising is due to the dollar’s decline. The DXY Dollar Currency Index demonstrates the dollar’s weakness since Black Thursday, and things could get worse as inflation begins to spiral out of control. Due to Bitcoin’s 21 million BTC supply, the asset is designed to appreciate as the dollar deflates. The dollar’s weakness alone could keep Bitcoin above $10,000 for good.

Last, but not least, is if there is any truth behind supply-based theories like the stock-to-flow model, the fact the halving is now in the past should be enough to keep the crypto asset above the crucial zone for now on. If not, proponents of lengthening cycle theories will be proven right, and the crypto asset could be at risk of a selloff by those who aren’t prepared to hold longer than the four years they expected.

Featured image from Deposit Photos, Chart from TradingView

Tony Spilotro , 2020-10-01 22:00:43

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NewsBlock © 2019 - 2020 All rights reserved.

NewsBlock © 2019 - 2020. All rights reserved.

While Bitcoin’s price seemingly moves without rhyme or reason — collapsing by dozens of percent and embarking on face-melting rallies on a whim — the cryptocurrency market is filled to the brim with fractals.

Related Reading: Analyst: Bitcoin Price Likely to Fall to Low-$8,000s as Chart Remains Weak

A brief aside: A fractal, in the context of technical analysis and financial markets anyway, is when an asset’s price action is seen during a different time. This form of analysis isn’t that popular, but it has proven to be somewhat valuable in analyzing Bitcoin.

One recent fractal popularized by a well-known cryptocurrency trader is implying that BTC is going to return to the low-$7,000s in the coming days.

Bitcoin Fractal Implies Retracement to Low-$7,000s

A well-known crypto trader going by “Tyler Durden” on Twitter recently posted the chart below, which shows that a Bitcoin price fractal may be playing out. The fractal has four phases: horizontal consolidation marked by one fakeout, a surge above the consolidation phase, a distribution, then a strong drop to fresh lows.

If the fractal plays out in full, BTC could reach the low-$7,000s again, potentially as low as $7,100. This would represent a 20-odd percent collapse from the current price point of $8,800.

It isn’t only a fractal that is hinting Bitcoin has the potential to visit its lows. As we reported on Saturday, Bloomberg believes that if the GTI Vera Convergence Divergence Indicator flips red, a downtrend could push the cryptocurrency back to $7,300.

Related Reading: Stephen Colbert Pokes Fun at Bitcoin in Monologue: Mainstream Gone Wrong?

Can Bulls Step In?

But again, many believe it is irrational to have such bearish interpretations of the cryptocurrency’s chart at the moment. As reported by NewsBTC earlier, Popular crypto trader Mayne recently noted that the “people waiting for $6,000” are irrational. He quipped that Bitcoin retracing and consolidating after its fourth-biggest bull move in history ($7,300 to $10,500, a 42% gain) is perfectly par for the course, but noted that it’s totally possible we can go lower from $8,800.

The medium-term technicals support this.

Trader and CoinTelegraph contributor FilbFilb found that by the end of November or start of December, the 50-week and 100-week moving averages will see a “golden cross,” which he claims is far more significant” for the Bitcoin market that other technical crosses.

Also, a Bitcoin price model created using Facebook Prophet machine learning found that the leading cryptocurrency is likely to end the year at just over $12,000. What’s notable about this model is that it called the price drop to $8,000 months in advance, and forecasted a ~$7,500 price bottom for BTC.

To put a cherry on the cryptocurrency cake, Crypto Thies observed that when Bitcoin bottomed at $7,300, it bounced decisively off the 0.618 Fibonacci Retracement of the move from $3,000 to $14,000, which correlates with the two-week volume-weighted moving average. He added that summer 2019’s consolidation was marked by Bitcoin flipping major resistances into support levels, implying that a bullish reversal and subsequent continuation is likely possible in the coming weeks.

Featured Image from Shutterstock

Nick Chong , 2019-11-10 12:00:38

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