Potential signal:
- If Bitcoin were to break above the $60,000 level, I am a buyer of this market, and aiming for the $67,000 level.
- I would have a stop loss at $56,500.
- It’s clear that the Bitcoin has a significant amount of support underneath, right around the $56,500 level.
- It is also the 50% Fibonacci retracement level, so a lot of people are going to be paying attention to it anyway.
- Over the last several sessions, we have seen a lot of buyers coming in and picking up the asset once we dipped below that level, as we have formed a couple of hammers now.
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That being said, this is a market that I think given enough time does try to break toward the $60,000 level, but I’m not willing to buy Bitcoin until we break above that level. Quite frankly, the Bitcoin market is a one that has been extraordinarily week over the last several weeks, and therefore I think you get a situation where you have to assume that the market needs to prove itself, and I believe that it proves itself if we break above the $60,000 level.
If we break $60,000
If we can break above the $60,000 level, I think that would have enough people coming into the market to celebrate the strength, and perhaps could get a lot of people interested in trying to chase the momentum that will almost certainly be a part of it. Breaking above that level is not only a psychological victory, but it would also be a situation where the massive selling pressure that we had seen over the last week or so would be under serious threat. At that point, the market could go looking to the 50-Day EMA.
A break above that indicator of course is very bullish and could open up the move to the $67,000 level. Alternatively, if the market were to break down below the recent swing low, we could open up a move down to the $50,000 level. The $50,000 level of course is a large, round, psychologically significant figure, and an area that a lot of people would be interested in. With this, I think you have to reevaluate the entire trading situation at this moment.
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