The Bitcoin market looks as if it is trying to turn things around, as the world is trying to find value here.
Bitcoin
Bitcoin is very noisy during the early hours on Wednesday, but in a good way for once. In fact, we did manage to break above the $72,000 level. Now we have to start to ask questions, is Bitcoin perhaps getting a little bit of a boost at this point?
Ultimately, the 50-day EMA is worth watching. It is at $74,428, but I do think that we are in the process of perhaps trying to form something along the lines of a rounding bottom. You can make an argument that the volume dropping and then accelerating to the upside opens up the possibility of a recovery here.
A Potential Rounding Bottom Formation
Are we in the midst of a rounding bottom? The Bitcoin market was left for dead, so I think you're going to have to be very cautious. I have been talking here at Daily Forex every couple days or so about how it looks like we're trying to find the floor.
And really, at this point in time, if the breakout can sustain at least a daily close above $72,000, I start to think about maybe getting a little bit of exposure here. I don't think Bitcoin is going to take off to the races. I recognize there are a lot of concerns here, but we could see a move to $84,000 before it's all said and done.
The market of course will be volatile and of course there are a lot of headlines out there that could really make the Bitcoin market just all over the place because of risk appetite just being all over the place. Ultimately the question now is, did we hit a major floor? $60,000 is a good candidate, but we'll have to see a little bit of follow-through.
If this is the bottom forming for Bitcoin, you have plenty of time. You don't have to be the first one to buy it. But again, a daily close above $72,000 has me very interested.
Potential signal: I am a buyer on a DAILY CLOSE above $72,000 with a stop loss at $65,000 and a potential target of $83,500.