First Mover: Resistance is useless as Bitcoin breaks $ 15K, Crypto becomes greedy

Bitcoin was lower, pausing after a three-day rally that saw prices approach $ 16,000, their highest since the beginning of 2018.

The recent rally left the largest cryptocurrency up 116% year to date, and some bullish digital asset market analysts were already seeing even higher levels. Denis Vinokourov, head of research at prime cryptocurrency broker Bequant, said in an email that there is the potential for a squeeze in the options market to drive prices up in the coming days.

“This, coupled with continued uncertainty over US election results and the economic fallout from the resurgence of the Covid pandemic, could push us to $ 17,000,” he said.

In traditional markets, US futures were lower than a closely monitored government report coming out Friday on employment trends in October. Gold was up 0.3% to $ 1,956 an ounce.

As bitcoin surpassed $ 15,000, analysts on Thursday were stepping back into the cryptocurrency’s 11-year history for clues as to what’s to come next.

Prices have already doubled this year, just like in 2019, and bitcoin is now openly discussed by global banks like Deutsche Bank as the best-performing asset in the world. Many observers argue that price movements are random and not necessarily linked to general macroeconomic trends. Although the relationship remains on the weaker side, for most of this year, the correlation between cryptocurrency price movements and traditional markets has increased.

And the investment narrative that bitcoin fund marketers are launching looks pretty strong at the moment: not only has cryptocurrency been launched by many bulls as the future of money and possibly a threat to the existing financial system, it is also positioned as a hedge against inflation at a time when the Federal Reserve and other central banks are printing billions of dollars of money to stimulate markets and economies, with little apparent signs of slowing.

There is now a belief among many traders that fear of losing, or FOMO, could drive the faster adoption of cryptocurrencies by both retail and institutional investors and quickly drive prices to a new record high above $ 20,000.

This is where the history lesson comes in. As some analysts reported this week, bitcoin prices have now entered a territory they have visited so rarely before investors read the price chart patterns – a practice widely followed among cryptocurrency traders known as “technical analysis” – View easy-to-locate stopping points between $ 15,000 and $ 20,000.

“The technical setup has been under construction for some time and has finally managed to break through,” Mati Greenspan, founder of foreign exchange and cryptocurrency analyst firm Quantum Economics, told subscribers in an email.

The screenshot above, from digital asset market analyst Messari, shows that bitcoin had previously traded just 20 days above the $ 15,000 price level, all in 2017.

And it was really powerful: once it crossed the $ 15,000 level, bitcoin quickly rose to an all-time high near $ 20,000.

Matt Blom, head of sales and trading for digital asset company Diginex, called it a “price gap.” So the speculation now is that a repeat could be in the cards.

All of this could be wishful thinking on the part of traders who analysts and investors who actually have no more information about the future than anyone else and are lucky enough to be in digital asset markets at a time when the rapidly growing ecosystem seems to be. be one of the few truly thriving industries.

Slow and steady progress may be more compelling to newcomers and the “crypto curious” than a quick march to the top that is quickly reversed. In any case, the prevailing mood in the market is pushing towards “extreme greed” from “fear” just a month ago.

“The case for bitcoin is getting stronger every day,” according to Messari. “Resistance is useless.”

If even there is.

Search data on the web suggests that popular interest in bitcoin remains at normal levels, despite a sharp rise in prices to around $ 16,000.

The best cryptocurrency has taken a nearly 50% gain in the past four weeks to trade as high as $ 15,971 early Friday, a level last seen during the bull market frenzy between December 2017 and January 2018.

Some observers say the rally is now being driven higher by the greed of retail trade and the fear of getting lost, known as FOMO. However, Google’s data suggests otherwise.

Google Trends, a barometer used to measure general interest in trending topics, is currently returning a value of 10 for the worldwide search query “bitcoin price”.

It is significantly lower than the value of 93 observed in early December 2017 after bitcoin’s record above $ 15,000. The current reading is also lower than the peak of 19 observed in the second week of May, when bitcoin suffered its third “halved” mining premium.

Google data suggests retail investors are showing calm over bitcoin’s recent rally and the market is far from being in a frenzy.

With popular interest still relatively low, it seems safe to say that FOMO has yet to take over the market and the ongoing institution-led rally has legs.

Read more: As Bitcoin grows, Google searches suggest some FOMO among retail investors

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