Bitcoin broke higher on Monday again, reaching towards the $57,500 area. In fact, we closed towards the very top of the candlestick which is a very bullish sign. Ultimately, the market is likely to go looking towards the $60,000 level, which will attract a certain amount of attention. Beyond that, we had a couple of quiet sessions during the weekend, so perhaps we have seen enough consolidation indigestion to continue pushing this market to the upside.
Regardless, this is a market that I think continues to see a lot of momentum, but it is also easy to see that we could see a bit of exhaustion creep into the market. After going as parabolic as we have, then it is very likely that we will see some type of pullback and exhaustion rather soon. That should offer plenty of value going forward, and it is obvious that Bitcoin is a market that people want to be involved in.
Underneath, I see the $53,800 level as support, just as the $50,000 level underneath will be. The $50,000 level will attract a lot of attention, as most traders will be looking at the big figure as a headline-grabbing level. The market breaking above the $50,000 level is a big event, so I think a lot of people will be looking to get involved if they get an opportunity to start buying Bitcoin anywhere near that level. On the other hand, if we were to break above the $60,000 level, that will only bring in more “FOMO” as people look towards even higher levels.
There is nothing on the chart that tells me I should be shorting this market, at least not until we break down below the $50,000 level at the very least. The market breaking below there could bring in a lot of selling orders, but that would be nothing new as the Bitcoin market is extraordinarily volatile. Quite frankly, you have to be used to this type of behavior if you want to be involved. If you do not have a high tolerance for volatility, this will not be the right place for you. It is a bullish market, so that is probably the most important thing that you need to keep in the back of your mind, as selling is almost impossible at this point.
