- Bitcoin consolidated after a prior collapse, with resistance near $93,000 and support between $80,000 and $84,000.
- Longer-term buyers may nibble, but broader upside depends on risk appetite and strength in other markets.
Bitcoin has been very noisy during Wednesday trading as we continue to see a bit of consolidation. Quite frankly, consolidation is a good thing for Bitcoin due to the fact that the market had collapsed previously. At this point, it looks like the $93,000 level is an area that is going to remain very difficult to break above. And now that the 50-day EMA is sitting just above there, I think it all adds more resistance to the market.
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That being said, I think the longer we go sideways, the more likely it is that Bitcoin will recover. The $84,000 level is support, and I think that extends down to the $80,000 level. In general, this is a market that I think if you are a longer-term believer in you probably are already starting to take a little bit of a nibble in the Bitcoin market in order to try to take advantage of what could end up being a very low price.
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That being said, if the market were to break down below the $80,000 level, then you would have a major problem in this market. We probably drop down to the $75,000 level, and then eventually $65,000. Keep in mind, a lot of this will come down to whether or not risk appetite is starting to pick up, and there is a real possibility that we are starting to turn the corner in Bitcoin, but I think it's early.
I think unless you are a longer-term trader, you probably are looking for momentum to the upside to actually stick in order to get long in the market. Because of this, it's almost like a two-speed market at the moment. And as a result, I think we've got a situation where it really comes down to whether or not we can get other assets, such as the stock market, technology stocks, et cetera, to take off. Then I think Bitcoin will follow.
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