The market breaking below the $50,000 might change the attitude right now, but we are nowhere near it.
The bitcoin market has pulled back just a bit during the trading session on Thursday to reach towards the $60,000 level. Quite frankly, this is an area that has been important for a while and digesting this massive gains that got us here in the first place makes quite a bit of sense. All things been equal, you can see that there is a massive bullish flag, which quite frankly measures for a move all the way to the $85,000 level.
If we turn around and wipe out the highs from the Tuesday session, I think at that point in time it is very likely that the Bitcoin market continues to go much higher. With this being the case, it opens up the move for the bullish flag, but in the short term it would probably target the $70,000 level. At this point, we have a certain amount of psychological resistance due to the fact that the market does tend to respect the every $10,000 region. All things been equal, if we do break to the upside, it could be rather explosive, and the fact that we have the jobs number on Friday might cause enough volatility and momentum entering the market to have those things occur.
On the other hand, if we were to break down below the $58,000 level, then we probably go taking a look at the 50 day EMA which is sitting at the $54,000 level and is rising. Any bounce in that area could be a nice buying opportunity, and of course the $50,000 level underneath is another area that we could see a lot of support due to the psychology and the structural set up in that general vicinity. At this juncture, I think it is only a matter of buying dips going forward, which quite frankly is how most Bitcoin believers trade anyway. The Bitcoin ETF opening up over the last week or so certainly helps the situation as well, because it gives an easy way to get involved in the markets, thereby driving more momentum and money into them. With this being the case, I think that Bitcoin will continue to go much higher, as there is still so much in the way of chasing at this point in time. The market breaking below the $50,000 might change the attitude right now, but we are nowhere near it.