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BTCUSD - Rallies Higher off Much Needed Support from $3300

   

 

BTCUSD - Rallies Higher off Much Needed Support from 3300
 
In the last few days Bitcoin (BTCUSD) has been able to rally higher and move away from the support level at $3300 pushing up to a three week high just above $4000. In the couple of weeks prior to the rally, it consolidated a little as it received some much needed support from around the $3300 level. Several weeks ago it received some support from around $3700 before dropping further down to the support at $3300. In the few weeks leading up to the consolidation, BTCUSD dropped sharply to its lowest levels for 2018 after having been quite content to trade right below the key level of $6500 for many weeks. Up against immense selling pressure it dropped sharply to around $5500 before consolidating for several days before dropping even further to below $4300 before the most recent drop.

 

It now looks like some considerable effort will be required to get the Bitcoin price back to within reach of the significant level of $6500, although it may be able to remain within touch should the support at $3300 hold strong. It had made several attempts to break higher through the resistance at $6500 however it was sold off on every occasion. In early September Bitcoin fell very sharply from a one month high near $7500 and quickly settled under $6500. The $6500 level has firmly established itself as a level of significance however this is obviously now a considerable distance away and new significant levels will need to be identified.

In the second half of July, BTCUSD enjoyed a strong surge higher moving through the key $6500 level and to the two month high. May and June saw Bitcoin fall strongly losing almost 40% of its value in that short period, from the peak near $10000 in early May to trading levels just below $6500. Throughout April, BTCUSD again rallied well off support at $6500 to approaching $10000, however these gains have been few and far between in 2018.

Despite the healthy rally in the last week, the price drop for Bitcoin has continued into December, after a miserable November, which saw Bitcoin drop 37% which is it worst drop since April 2011, when it dropped 39%.  Despite the falls and the scepticism surrounding Bitcoin, there are still many people who believe in the technology and that the adoption of digital tokens will revolutionize the financial services industry.  However what remains a mystery is how the technology will replace potentially outdated systems and how long the technology revolution will take.  Founder of cryptocurrency merchant bank Galaxy Digital Holdings Mike Novogratz said that he does not expect the Bitcoin price to decline much further.  Despite the recent slump in the market, Novogratz projected that the Bitcoin price will stay between $3,000 and $6,000 in the foreseeable future.  Erik Finman, who became a teenage bitcoin millionaire has warned that the long-term outlook is bleak.  “Bitcoin is dead, it’s too fragmented, there’s tons of infighting I just don’t think it will last,” Finman said.  “It may have a bull market or two left in it, but long-term, its dead.”

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The information provided herein is for general informational and educational purposes only. It is not intended and should not be construed to constitute advice. If such information is acted upon by you then this should be solely at your discretion and Valutrades will not be held accountable in any way.

This post was written by Graeme Watkins

CEO Valutrades Limited, Graeme Watkins is an FX and CFD market veteran with more than 10 years experience. Key roles include management, senior systems and controls, sales, project management and operations. Graeme has help significant roles for both brokerages and technology platforms.

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