Bitcoin markets got hit a bit during the trading session on Wednesday to reach below the $57,000 level. This is a market that has been trying everything it can to break above the $60,000 level but has failed. That being the case, the market has struggled a bit to break above there and I think that this pullback that we are seeing at the moment is possibly going to be a buying opportunity. The $55,000 level should be a small support level, and underneath there we have the $50,000 level, which is a huge round figure. Beyond that, we also have the 50-day EMA coming into the picture in that area, so I think there are plenty of areas underneath that could cause buyers to come back in, so I think it is a simple matter of waiting for support or a bounce to get involved.
If we break down below the 50-day EMA, then that could bring in fresh selling, perhaps reaching down towards the $45,000 level. That is an area that has previously been supportive, so I think that also could have an influence on what happens next. With all of the massive amount of support that I see underneath, it is only a matter of time before I would be bullish on Bitcoin again.
In fact, it is not until we break down below the $40,000 level that I begin to worry about Bitcoin, and even then, I think the 200-day EMA probably has something to say as far as support is concerned as well. It is worth noting, though, that the $60,000 level has been such resistance that perhaps maybe we are starting to see a bit of profit-taking. The market is most certainly losing momentum, which in the crypto markets is certainly something that you need to pay close attention to. This is not the stock market, as crypto is much more sensitive to momentum than more traditional markets. If that is going to be the case, I think that we could see a bit of a sell-off here, but that certainly does not mean that you should be a seller. I would rather wait for a daily candlestick that tells me it is time to start buying. We may have a couple of days’ worth of selling ahead of us, but that only offers value in the end.
