Bitcoin Daily Forecast
Bitcoin rallied a bit during the trading session on Friday, reaching towards the $4000 level. That’s an area that is significant resistance as we have seen over the last several sessions, and of course previously going back on this daily chart. At this point, it’s very likely that the market will continue to respect this area as resistance, so I think it’s only a matter time before we sell off again. However, you have to look at the tenacity of the last couple of days as somewhat impressive.
The 50 day EMA is sitting just below current trading, so I think it offers a little bit of dynamic support, and then of course we have the large-volume candle from Monday that show support underneath. At this point, I think that it’s likely that pullbacks will be possible. Looking at this chart, I think that there is significant resistance above that extends to the $4200 level.
If we do break down below the 50 day EMA, then I think the market probably goes down to the $3600 level. Looking at this chart, I think that the $3500 level underneath could be supportive as well. In general, I believe that we are going to see a lot of back-and-forth trading, and a pullback makes a lot of sense. I don’t think we have enough interest in this market to send it higher, and as a result I do favor the downside. The longer-term downtrend is still very much intact, but obviously we have a bit of buying pressure. In general, this looks very much like a basing pattern, but I think this basing pattern is consolidation that we are going to be in for quite some time.
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