- The BTC/USD market has rallied rather significantly during the trading session on Friday as the US dollar gets hammered.
- The $20,000 level is an area that we need to pay close attention to, and therefore it’s not a huge surprise to see a reaction in this general vicinity.
- That being said, Bitcoin continues to be very sensitive to risk appetite, so you need to be paying attention to what the rest of the world is thinking.
- If risk assets continue to fall, then it makes quite a bit of a sense that something pretty far out on the risk appetite spectrum would fail.
The size of a candlestick means a lot, and the fact that this is a big one means that we are probably going to continue to see a little bit of a rally. At this point, the market could very well go looking to the $25,000 level, which is an area that I think is a significant amount of resistance. It’s not until we break above there that I would believe in a Bitcoin rally, but I think now it’s likely that signs of exhaustion will continue to be jumped on, as they offer an opportunity to get short yet again.
Bitcoin Likely to Drift Lower
Breaking down below the $18,000 level will be a very negative turn of events, as it would be a fresh, new low. At that point, it’s very likely that Bitcoin could drop down to the $15,000 level, followed by the $12,000 level. The significance of the $12,000 level could be the fact that we started the latest bullish run from that level, and that there should be a lot of “market memory” attached to that.
A lot of people that I respect expect Bitcoin to drop down to that level, if not the $10,000 area. If we can get down to that area, then I will start to accumulate for the next bullish run. Keep in mind that Bitcoin is highly speculative, and we have a scenario where the risk appetite out there has been eviscerated. Yes, we had a nice run during the day on Friday, but quite frankly I’d be surprised if this rally lasted more than a couple of days. Pay attention to the US dollar, it can give you an idea as to where we are going in this market as there is a huge negative correlation.
Ready to trade our Bitcoin trading forecast online? Here are the best MT4 crypto brokers to choose from.