Up or down? These Bitcoin Price Levels Suggest Next $ 13K Move

0
12

The price of Bitcoin (BTC) had a terrific month as the price rose from $ 10,500 to $ 13,800. However, in recent days, momentum has slowed amid growing coronavirus fears. The price of Bitcoin fell from $ 13,800 to $ 12,900 on October 28, making the recent breakout a fake.

Along with a correction in cryptomarkets, equity and commodities markets also showed weakness. As the S&P retraced 4% on Wednesday, silver also corrected 6%. The only asset that is doing relatively well was the US Dollar Currency Index (DXY). In other words, investors are flying back to the USD for added security.

The $ 13,500-14,000 area confirms bitcoin’s resistance

2 day BTC / USD chart. Source: TradingView

The 2 day chart shows apparent resistance in the $ 13,500-14,000 area as a rejection is seen in this area. The $ 13,500-14,000 area is the last big hurdle until a potential new all-time high can be reached. Many investors and traders see this area as crucial.

The chart also shows a clear support area ready for testing in the coming period. This area is marked between $ 11,600 and $ 12,200. If this zone acts as a support, new construction linked to the range can be established to start a period of healthy accumulation.

ALSO READ  Large Chinese chemical company uses blockchain to cut trade finance costs

DXY bounces upwards, causing the BTC price to drop

1 day chart of the US dollar currency index. Source: TradingView

As fear surrounding possible full lockdowns returns across Europe, the flight to safety is also starting.

The first wave took place in March 2020, when the flight to the US dollar was seen as a market crash. As a result, the US Dollar Currency Index (DXY) found a low point and rebounded from the 92.50 point level. Currently, it is close to 94 points, through which the recent rebound in the DXY index has triggered weakness in other markets.

Bitcoin has retreated strongly in recent days, but even Silver has shown a 6% correction in a single day.

1 day chart of the US dollar currency index. Source: TradingView

As the data shows, the correlation between Bitcoin and the DXY index has turned reverse since the March crash. This is also similar to the movements of gold.

ALSO READ  Dash introduces protocol version management in the update

But what can be inferred from this data is that the likelihood of further corrections for Bitcoin is rising amid weak legacy markets and social unrest surrounding potential lockdowns.

A correction would not necessarily be unhealthy for the Bitcoin market at this point, as it could lead to further accumulation.

The majority of investors certainly want to see a straight line towards $ 200,000, but that just isn’t happening. At best, Bitcoin is at the start of a new cycle, through which the boring side part will continue to reoccur. Once all the levels are tested, parabolic movements can occur in the price discovery.

Bulls must recoup $ 13.3K

2 hour BTC / USDT chart. Source: TradingView

A familiar concept is a breakout above previous resistance for liquidity. After that, an immediate fall in the range occurs. This is called a fake and is often seen in the markets to take liquidity.

ALSO READ  Indian arrested for crypto fraud via Morris Coin program

As the chart shows, a clear resistance zone is established between $ 13,250 and $ 13,400 and should be broken to maintain new upward momentum. If the resistance zone cannot be cleared, the decline becomes more likely.

Levels below current prices are $ 12,700 to $ 12,850 and $ 11,600 to $ 11,800, as higher time zones to watch for potential support.

The final “candle to hell” scenario is only expected if the support area between $ 12,700 and $ 12,850 is lost. However, such a drop would justify massive sales across all crypto markets, with altcoins taking the biggest losses from such a correction on Bitcoin.

The views and opinions expressed herein are solely those of author and do not necessarily reflect the views of TBEN. Every investment and trading move involves risk. You need to do your own research when making a decision.