- The BTC/USD plunged during the trading session on Thursday to reach down toward the $18,000 level.
- The $18,000 level is an area that has been important multiple times along the way since the beginning of summer.
- At this point, I think this is a market that will continue to see a lot of volatility and choppiness, but I also recognize that we are in a downtrend and rallies are anemic at best.
If we break down below the $18,000 level, it allows fresh selling and I think could allow Bitcoin to plunge all the way down below the $15,000 level on its way down to the $12,000 level. The $12,000 level is an area where we had taken off from previously, and therefore I think it’s worth noting that it would be a complete “round-trip” from the last bullish market. The market making a round-trip is nothing new, as Bitcoin has seen these types of plunges previously, and there’s nothing to keep it from happening again. The market did manage to turn around and go positive for the session, so that’s a very good look, but at the end of the day I don’t think it has changed much.
Waiting for Extreme Volatility
If we do break higher from here, the 50-Day EMA is going to come into the picture, which is right around the crucial and psychologically important $20,000 level. The $20,000 level is an area that a lot of people will be interested in, and even breaking above that would only be a psychological victory. There’s a lot of noise that will be difficult to get beyond. The $25,000 level is an area that you need to pay close attention to, as it is a large, round, psychologically significant figure, and an area where we had pulled back from. Beyond that, the 200-Day EMA sits in that general vicinity as well, so I think that would cause quite a bit of noise.
It’s not until we break above the $25,000 level that I would be convinced that Bitcoin is trying to make a bigger move that could be held onto. The only thing we can count on at this point is extreme volatility, which is somewhat redundant in Bitcoin, but seems to be even more so than usual as the uncertainty around the world continues to see risk assets like Bitcoin get thrown around.
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