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A surprise sell-off in the Bitcoin market on Sunday that plunged the price to $ 17,610 met an equally strong buying wall. The cryptocurrency recovers later, jumping above $ 18,500, a level it held as support before the weekend crash.
But for Marc Principato, Bitcoin hasn’t really put aside its bearish risks. The executive director of The Green Bridge Investing has contemplated the possibilities of further downward correction attempts as short-term participants continue to see $ 18,500 as an infection point in the ongoing uptrend.
“Today’s move from the high of 18,770 to the low of 17,600 demonstrates how the FAST sales activity can assert itself,” Principato wrote in a late Sunday note. “Although today’s candle sets a bullish pin bar, the risk at these levels for a SWING TRADE is still unreasonably high. “
Bitcoin at $ 14K
The “bullish pin bar” indicated a long bearish wick that Bitcoin formed during Sunday’s sell off. It represented the bulls’ rejection of volatile bearish attempts, a confirmation that buyers are protecting the $ 17,500 area from aggressive bearish onslaught.
Bitcoin bulls reject two sell-off attempts to affirm an overall upward trend. Source: BTCUSD on TradingView.com
But Mr. Principality refrained from suggesting an accumulation of between $ 17,000 and $ 18,500. The analyst said he is waiting for Bitcoin to suffer another bearish correction, but below the $ 17,000 support. A “proportional support,” he added, is at $ 16,000 or in the higher $ 14,000 range.
However, traders should wait for a bullish confirmation even if Bitcoin hits the $ 14,000-16,000 range, Principato warned, adding that the area only allows analysts to measure the risks for their future trading strategies.
Basically strong
Bitcoin has rallied relentlessly for six weeks in a row, rising nearly 78% as traders assessed growing institutional investments in the cryptocurrency space.
Pantera Capital, a California-based wealth management firm, said payment service giants PayPal and CashApp have bought over 100 percent of Bitcoin’s current mining offering, leading to a supply shortfall in both retail and marketplaces. institutional ones.
On the other hand, top strategists at ARK Invests, JPMorgan, and Blackrock have made a bullish case for the cryptocurrency, citing its anti-inflationary characteristics against the excess US dollar, as well as its ability to outperform gold for long. deadline to become the ideal hedging business in times of crisis.
“[Bitcoin] it’s as functional as passing a gold bar around, “Rick Rieder, BlackRock’s chief investment officer, Rick Rieder, told CNBC on Friday.
Strong institutional support for Bitcoin has somewhat offset its technical risks. It has allowed more traders / investors to hold the cryptocurrency than to sell it at its local highs, according to numerous sources that have shown an increase in so-called HODLING sentiment and a jump in Bitcoin withdrawals from major exchanges.
