Bitcoin Breaks Out of Consolidation

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I do believe that Bitcoin will turn around eventually, I just don’t know that it’s that time quite yet.

BTC/USD rallied a bit Tuesday after initially dipping lower. Ultimately, it looks like we are trying to break out of the rectangle that we have been in for a while, but we also have to tangle with the 50-Day EMA, which we have not broken above yet. That being said, this is a promising turn of events and he could show strength in the short term.

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As for the longer term, I think that the market is more likely than not going to be a scenario where there should be plenty of sellers jumping in, as there is a multitude of reasons to think that this market is going to continue to see a lot of downward pressure. After all, there’s a huge “risk off” type of market out there, and Bitcoin needs people to be willing to step out into a riskier asset. That does not happen in markets that are this nervous, so I think any short-lived rally will probably have people bailing out of negative positions at a better price.

If we were to break above the 50 Day EMA, we could see a run toward the $20,000 level, which is the beginning of the next major cluster. If we do get that move, I would anticipate that there will be plenty of downward pressure there as well. That being said, if we were to turn around and break above the $32,000 level, we will have broken above a significant structural part of the market. If that happens, we can start talking about an uptrend.

Until then, I think we are still very much in a downtrend, and it’s likely that we could drop down below the $18,000 level. If we break it down below there, then I think that the Bitcoin market could fall all the way down to the $12,000 level. The $12,000 level is an area that a lot of people will be interested in, as it is a major area on the longer-term charts, and an area we launched from to kick off the last bullish rally. Because of this, “market memory” will come back into play, and it’s likely that we would see people jumping in. I do believe that Bitcoin will turn around eventually, I just don’t know that it’s that time quite yet.

BTC/USD

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