Bitcoin futures ready’s for another showdown with $10,500
Just like the U.S. Dollar fell through a key support level late last week, Bitcoin also moved past a key resistance level in trading today. Both of these moves have two things in common first these levels were both based on extremely long term Fibonacci retrenchments spanning vast amounts of their all-time charts. Secondly these recent breakouts represent the high likelihood that both the U.S. Dollar and Bitcoin will continue to move in their respective directions.
Countries North, South, East and West race to save the people they were sworn to protect. But with salvation comes the degradation of the very money they spent. While hyper-inflation boosts the safe havens as they all print their way out of debt.
You however, clever investor have been accumulating a certain hard asset.
G.L.D or S.L.V or Bitcoin Better yet!
Last week we spoke about the fact that the U.S. Dollar index had just broken below the 50% retracement at 95.92 and was almost certainly going to revisit the 38% just below 90. 90 in the index was unsurmountable resistance for the entire Obama presidency. This all-encompassing retracement spans from U.S.D’s highest point in over 40 years (120.80), to its lowest point ever reached back in 2008 at 71.05. This week the dollar index lost about 2% and stands to lose at least another 5% before it stabilizes.
This has been boosting gains in the other safe haven assets particularly gold and silver for the past 5 trading sessions. I was convinced this would eventually spill over into Bitcoin and BTC futures which I believe is what we are witnessing today.
Although this bump in value did not come as a surprise I did however not see BTC breaking out of its descending channel until January of 2021. Today’s activity nevertheless did take me by surprise as BTC futures broke out of its 2 and a half month slightly downwards channel. Today BTC futures also more importantly broke above its 50-day moving average for the first time in almost 5 months. If you look at a chart of BTC you will notice that very rarely does it trade above the 50-day M.A. without a high flying spectacle of a rally akin to a man being shot from a cannon taking place. Central banks have loaded the barrel with plenty of powder and the torch is being lowered. Whether or not the charge inside is a dud it would be wise to cover your ears and look up to the sky.