The Bitcoin market has gone straight up in the air for several days in a row, but the Thursday session was rather quiet. This is a market that has needed to see some type of slow down because it had gotten so parabolic. At this point, the $55,000 level looks to be offering resistance, but I think that is simply a speed bump along the road to higher pricing.
A pullback makes a certain amount of sense, and I would anticipate that there should be a certain amount of support in the neighborhood of $50,000, which is a large, round, psychologically significant figure and an area where we have seen some action in the past. The fact that the jobs number comes out on Friday could have a little bit of an effect on the US dollar, which could be a bit of a knock on effect over here as well, albeit somewhat minor.
If we were to break down below the $50,000 level, I think there is support extending down to the $38,000 level. To the upside, the market is likely to continue to see a lot of volatility, but I think we would go looking towards the $60,000 level, this of course was where we had seen a major amount of selling pressure previously, and it certainly looks as if we are trying to get to that area. Whether or not we can break above there is a completely different question, but it is worth noting that the market had lost roughly 50% of its value, and now plenty of value hunters get excited about owning Bitcoin yet again. Furthermore, we have seem to have forgotten all about the issues in China, which was a major driver of the market to the downside. It looks as if we continue to be in a “buy on the dips” type of scenario, and with that I think it is only a matter of time before any pullback gets bought into. I also do not see any reason to think about shorting this market anytime soon, it is obviously very bullish and should continue to be so. Just because we slowed down a bit on Thursday does not mean that anything has changed significantly, rather that we just run out of short-term momentum.
