Trading Bitcoin: Retest of $11k?

Retest of $11k?

Retest of $11k?: After a rough week in the crypto market, Bitcoin has found support at $9.5k. Currently, the TD sequential indicator is on a green 2 above a green 1 and is presenting a buy signal. However, the 50MA (grey) is acting as resistance at $10.8k as well as the Lucid SAR (blue x’s) at $11k. As of now, it seems probable that Bitcoin will retest $11k only to be rejected back to $9.5k. Until Bitcoin breaks above the moving average on the daily chart, and the previous lower high at 12.3k, the overall structure of the trend remains bearish.

4 Hour

Bitcoin is on a green 3 of 9 candle on the 4 hour chart above. The previous green 2 candle did not close above the previous green 1 candle, therefore, a long trade was not activated on the 4 hour timeframe. Price has also broken above the moving averages which were acting as resistance. However, the moving averages are about to form a death cross which is typically indicative of an incoming bearish trend. That being said, moving averages are lagging indicators.

Weekly

For the past few weeks, we have been highlighting the descending triangle formation Bitcoin may be falling into. While it may not be a textbook descending triangle formation, there has been a pattern of lower highs with a base at roughly $9.5k. Furthermore, if the current bullish price action continues, Bitcoin’s closest point of rejection will be the descending trend line at $11.2k. Additionally, the sequential indicator is on a price flip to a green 1 and is in neutral territory.

Cryptocurrency News

Source available here

Bakkt, a subsidiary of the Intercontinental Exchange, was given approval to launch Bitcoin futures on September 23rd. Many crypto enthusiasts think the launch will create a new wave of institutional money into Bitcoin. However, Bakkt does not introduce anything new into the industry which wasn’t previously available. Why would institutional investors flock to Bitcoin just because Bakkt was created? If institutions really wanted to play in Bitcoin’s liquidity pool, they would use Coinbase’s custodial service for institutions.

Conclusion

Bitcoin has bounced from the 0.382 fibonacci line at $9.5k and is now experiencing bullish price action. For now, it appears the bull trend will continue until a probable rejection at the descending trend line at roughly $11.2k. Until price can break above the previous lower high at $12.3k, the overall trend remains neutral-bearish.

Disclaimer: The author of the article hodls Bitcoin.