Trading Bitcoin: Bulls Cleared for $8.8k

Bulls Cleared for $8.8k

Bulls cleared for $8.8k: In yesterday’s article we mentioned that a green 2 going above a green 1 is bullish according to the rules of the sequential indicator. Therefore, yesterday’s price action told you to take a long trade at $8.1k. Today, Bitcoin is trading at a price of $8.4k. If you missed yesterday’s long trade, don’t worry it’s not too late. Bitcoin is still in a bullish posture on the daily chart above. According to sequential, Bitcoin still has the possibility of increasing for the next 4 days before a possible pullback. During this time, there’s a strong likelihood Bitcoin will retest its previous high of $8.8k.

4 Hour

After breaking through resistance at $8.3k, Bitcoin is on a green 7 of 9 candle on the 4 hour chart above. Therefore, price is still bullish in the short-term.

Weekly Fibonacci

Due to the parabolic increase throughout the month of May, we have been expecting a pullback of roughly 30-40%. This pullback would give us a target in the 6,000s. However, if the pullback never comes, the most critical level of resistance for the bulls is the 0.382 fibonacci line at roughly $9.4k. We have discussed this level in previous articles and have compared it to fibonacci resistance levels seen in gold.

Gold Experienced Similar Conditions

Above is a chart of gold which peaked in 2011 and bottomed in 2016. Shortly after gold bottomed in 2016, price increased until it was rejected by the 0.382 Fibonacci level (red circle). A large pullback followed and gold remains under the 0.382 Fibonacci level to this day. Bitcoin now faces similar circumstances and must break above the 0.382 Fibonacci level or face a harsh pullback. That being said, Bitcoin and the cryptocurrency market move faster than gold and most traditional markets.

Cryptocurrency News

Massive news hit the cryptocurrency market today with the announcement that Binance exchange will no longer be servicing US customers starting in September. Binance is the world’s largest cryptocurrency exchange and the US currently accounts for 15% of Binance’s total volume. After the release of the news, Binance is down 7% today. Some US users will still access Binance exchange illegally by using a VPN.

Image source: The Block Crypto

In other news, Jack Dorsey, CEO of Twitter, recently gave an interview to talk about the future of technology and cryptocurrency. When asked about Facebook and their plans to create their own cryptocurrency GlobalCoin, Dorsey said the following,

We need a currency for the internet. And the internet being an entity that isn’t controlled by any company or any one government, that is for the world and for the people of the world.

Dorsey went on to say, “I haven’t seen any other currency that would challenge it (bitcoin) across the dimensions that I think are really important. First, I think it has an amazing brand. The other thing that I think makes it probably the strongest candidate is that the principles behind it are very pure. The creation of it was very pure, and focused on a public good, rather than any other particular agenda.”

Conclusion

Bulls Cleared for $8.8k: Bitcoin is in a short-term bullish posture to $8.8k. Support remains at $8.3k and $7.8k. The most critical levels of resistance are $8.8k and $9.4k.