Bitcoin - Threatening to breakout
While SHIB consolidates its 40% gain of yesterday, I was wondering whether it might be a good time to take a closer look at BTC. So here goes.
However, before I do, what does Elon Musk think? Well, he thinks that we are “past peak inflation”.
- Source: bloomberg.com/news/articles/2022-08-04/musk-says-inflation-is-past-peak-as-component-costs-trend-down
Does this give the US Federal Reserve cover to ease its interest rate hiking policy when it next meets in September? Possibly, and this could set the bullish juices flowing if this sort of idea takes hold. That’s an important backdrop in considering the markets, as asset values are often directly correlated to interest rate expectations. And while its not confirmed as fact, expectations tend to get priced in early.
So, now onto Bitcoin.
Looking at the daily chart, we see that price has been squeezed over the past 5 days between the overhead resistance of the 1D 100MA (light blue MA) and the rising 1D 12MA and rising channel mid-line from below. As I write this, price is challenging the 100MA of a confirmed break above this line is the necessary precursor for any type of bullish action. So, can the exuberance of SHIB investors influence the outcomes in Bitcoin are drive price above resistance?
If so, there are a number of structural elements that will conspire to resist is appreciation.
Personally, I like the idea that BTC will get into the 28.8K to psychologically significant 30k zone before correcting.
I note that since commencing this review, BTC has marginally broken above the 1D 100MA. If it can hold above, the next few weeks might look very good for BTC.
So, what comes first, 28.8k or a new low under 17.5k? Are you betting against Elon Musk?
However, before I do, what does Elon Musk think? Well, he thinks that we are “past peak inflation”.
- Source: bloomberg.com/news/articles/2022-08-04/musk-says-inflation-is-past-peak-as-component-costs-trend-down
Does this give the US Federal Reserve cover to ease its interest rate hiking policy when it next meets in September? Possibly, and this could set the bullish juices flowing if this sort of idea takes hold. That’s an important backdrop in considering the markets, as asset values are often directly correlated to interest rate expectations. And while its not confirmed as fact, expectations tend to get priced in early.
So, now onto Bitcoin.
Looking at the daily chart, we see that price has been squeezed over the past 5 days between the overhead resistance of the 1D 100MA (light blue MA) and the rising 1D 12MA and rising channel mid-line from below. As I write this, price is challenging the 100MA of a confirmed break above this line is the necessary precursor for any type of bullish action. So, can the exuberance of SHIB investors influence the outcomes in Bitcoin are drive price above resistance?
If so, there are a number of structural elements that will conspire to resist is appreciation.
- Firstly, there is the upper bound of the rising channel at <5% gain.
- Then there is the longer term Bear Market Trend Line at around 7.5% gain.
- Then there is the 28.8k prior support zone for a 16.3% gain.
- Then above that, we have the confluence of the 1D 200MA and prior resistance at 32.2k for a 30% gain.
Personally, I like the idea that BTC will get into the 28.8K to psychologically significant 30k zone before correcting.
I note that since commencing this review, BTC has marginally broken above the 1D 100MA. If it can hold above, the next few weeks might look very good for BTC.
So, what comes first, 28.8k or a new low under 17.5k? Are you betting against Elon Musk?
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