Prices are down 4.2 percent in the last 24 hours but even so, Bitcoin bulls have a chance. A combination of fundamentals and supportive candlestick arrangement mean buyers can still recoup today’s losses and print new highs in days ahead.
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It has been 11 years of unimaginable price movements, and at one time, Bitcoin changed hands at a whopping $20,000 a pop. However, that’s a distant memory. Instead what liters the crypto street is projections based on flimsy technical and fundamental events of the past.
On the one hand, fundamental traders bank on an improving and a robust ecosystem while naysayers have reason to believe that all these multi-million dollar projects will be in futility. All the same, Bitcoin prices continue to move haphazardly, and it has been exacerbated more by liquidity reduction partly because investors are backing off.
Consequently, asset prices are becoming increasingly unpredictable. Jan Van Eck, the CEO of VanEck Associate, after a survey, notes that Bitcoin investors are now ditching crypto for traditional, less volatile assets like Gold and fiat.
“Interestingly, we just polled 4,000 Bitcoin investors. Their No. 1 investment for 2019 is gold. So gold lost to Bitcoin [before], and now it’s going the other way.”
BTC prices are back to red, and after a solid week, the most valuable coin is down 4.2 percent at the time of writing. The drop began earlier on in the Asian session. What we have as a result are prices trending below the main support line at $3,500. As mentioned before, the line flashes with the 78.6 percent Fibonacci retracement level of Dec 2018 high low. There are two approaches to mitigate losses. First, conservatives can hedge against stable coins.
Meanwhile, aggressive traders can trade BTC derivatives at platforms as BitMex. It’s a protective measure because should today’s sellers be confirmed tomorrow, then we can see BTC dropping to $3,200. On a more optimistic approach, we may as well have a double-bottom today confirming gains of Dec 16.
Notice that, even though sellers may have been in control for the better part of the month, they are yet to reverse gains of mid-Dec to early Jan 42 days after rejecting higher highs. As such, bulls are in control from an effort versus result perspective.
Our previous BTC/USD trade plans are clear: bulls are in charge. However, before we recommend longs, prices must first surge above $3,800. That means the bear bar of Jan 20—20k is our anchor bar. It’s easy. Current averages stand at 12k.
For bulls to be in control, then we must see prices rallying above $3,800 recouping losses of Jan 20 with above average volumes. It will be perfect if these volumes print 35k (like Jan 10’s) or higher.
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