The bitcoin weekend has begun on a sad note. Around $600 wiped in about 15 minutes!
That sets the market tone for the next 48 hours. Bitcoin is now recovering from an intraday low of $9,402, now up by a mere 1 percent. But its likelihood of continuing its corrective downtrend is higher thanks to the flipping bias of technical indicators.
As of now, the price is testing support in an ascending trendline as indicated via black. A reversal, at this point, could see a minor pullback towards the nearest upside target at $10,216. That makes an ideal interim Long position for day traders, providing they protect it with a stop loss order just $10-30 below the entry point of trade.
The last bitcoin reversal from the ascending trendline support stretched up to 22 percent. Assuming a similar bounce back, the cryptocurrency could test the $11,470-11,500 range before pulling back to continue their corrective downside action.
That means brave-hearts could extend their Long target to $11,500 if they want. Again, they should be cautious of sudden downswings and maintain their stop losses likewise.
A break below the ascending trendline initially puts bitcoin in a fake-out area. That means that even if the trendline is invalidated, the price could recover above it owing to its oversold conditions.
The downside provides ample of profitable opportunities to bears. Dipping below the trendline brings $8,947-8,950 as a primary target range for short positions. A further drop and those targets could be extended to $8,350.
Like always, maintaining a stop loss $10-20 above the entry position could minimize traders’ losses should the bias switches to the upside.
The interim drop in the bitcoin market does not shake its long-term bullish bias. Investors are still bullish on Bakkt launch, halving event, and a gloomy global economical outlook that could boost bitcoin’s adoption among the mainstream financial players.
The hedge fund of veteran investor Bill Miller has returned 46 percent gains in the first half of this year. Bitcoin allegedly covered 50 percent of that portfolio. It could further allow other institutional players to look into the cryptocurrency.
On the flip side, US Treasury Secretary Steven Mnuchin has warned that he would make sure bitcoin does not exist in the next ten years. The US regulators are still to decide how they would approach bitcoin regulations.
CoinStats’ cryptocurrency portfolio management app shows 53.7 of its users interested in selling bitcoin intraday.