Bitcoin markets initially tried to rally during the day on Tuesday but found the $9000 region to be a bit too resistive. We pulled back just a bit though, and it now looks as if the market isn’t quite ready to break above that $9000 level. I believe that pullbacks at this point should continue to be thought of as potential buying opportunities for those who are longer-term “buy-and-hold” investors. However, I think that in the short term is likely that the market is drop a bit. Not being able to break above the $9000 level of course is a negative sign, especially considering that the $10,000 level is even more resistive. I recognize the $8000 level underneath is support, followed by even more support at the $7000 level. The volatility in this market continues, but I think that part of the problem during the day on Tuesday was the massive strength that we had seen in the greenback. Don’t forget the Forex markets when trading bitcoin, because of course half of the equation is the US dollar.
Bitcoin try to rally against the Japanese yen as well but turned around of form a somewhat negative candle. The market looks likely to continue to drift towards the ¥900,000 level. The ¥1 million level above is resistant, and of course a psychologically important number. I believe that if the market somehow breaks above the ¥1.1 million level, we will go reaching towards ¥1.25 million level. Having said that, the Japanese yen got pummeled against the US dollar during the day, the benchmark for the Japanese yen, but even with a soft Japanese yen, bitcoin could rally. That tells me that we are running into some serious trouble again. I suspect short-term selling is to be found.