The bears in BTC have a chance to take the market by the horns
Bitcoin futures just like gold were expected to pop higher after yesterday’s ‘non-event’ speech by Chairman Powell. Both assets however dropped sharply yesterday to the surprise of many traders.
As Cointelegraph reported ~
“It could have been the confluence of the market pricing in the Jackson Hole symposium and the lower-than-expected inflation rate.
The sell-the-news drop in the Bitcoin and gold markets further intensified the downtrend, causing Bitcoin to retrace to early August levels.”
However now it is looking like an exaggerated knee jerk reaction with both gold and Bitcoin both trading up over 2% on the day. Both assets more than made up for any downside experienced in trading yesterday. Currently as of 4:20 PM EDT BTC futures basis the most active CME contract is trading up over 2.5% at $11,625. This puts BTC at an extremely critical level which very well may decide if BTC continues to rally or correct to approximately $9,600.
Our first chart illustrates the technical and historical evidence to support our reasoning. On this chart we have a simple Fibonacci retracement from BTC’s all-time highs to their all-time lows. We then draw a horizontal line in blue at the 23%, 38%, 50% and 61.8% to intersect into current time frames. First, year to date price action has been inside these four levels for the entire 365 days except for a month beginning in March (a time when everything was getting liquidated). Also, each one of these levels was a strong area of resistance/support forming a congestion area except for the 618% which was basically 2019’s highs.
Other analysts also agree that this scenario is a plausible one. At least for the bearish version me and analysts at Cointelegraph anticipate if Bitcoin fails in taking and holding $11,700 then it was in for a correction to as low as the most historically prominent Fib. level, the 23% at approximately $9,600 on my charts.
I however see the bullish possibility different in terms of price targets. I am forecasting that if we see a solid break above the 50% retracement ($11,583) we will see Bitcoin rise and probably touch upon an important level, the .618% retracement at $13,576.
Other insiders see prices going all the way too fill a gap on the CME’s futures charts at $16,000. I do not expect to see this happen in a single rally. Either way the census is the bulls must take and hold $11,700 in order to remain the dominant market force.