Bitcoin has hit another yearly high, smashing through the $9k barrier. All eyes are now on $10,000 BTC.
The epic bullrun that started on 1 April shows no sign of stopping. Having pulled back sharply after breaching $9k on the last day of May, bitcoin bottomed at $7,400 and then swiftly recovered. BTC broke the $9,000 mark once again on Sunday, closing the week just below that level. Monday once again saw a strong advance, pushing upwards to a new yearly high at $9,423.
Right now, bitcoin is trading around $9,100. The successful breach of resistance at $9k is very bullish, and various other indicators are making the case for a move higher still.
$10,000 is the next obvious landmark for bitcoin. As a large round number, this has psychological significance – it certainly did in the bull market of 2017. This will very likely be the point at which the mainstream media start to wake up again and report more widely on bitcoin. And it will likely therefore also be where retail money starts to come in again.
We are still expecting a pullback at some point, though there is really no telling when that will happen. Elliott Wave theory suggests that we might be coming to the end of a Wave 1 move, which will be followed by a corrective Wave 2 that could take bitcoin back down to far lower levels – but that will only be obvious in hindsight, and there is no way of telling when a correction will happen or how deep it might be. It’s fair to expect some resistance at $10k, but it’s also entirely possible that bitcoin will push higher – perhaps to $11k or $12k – before there is meaningful profit-taking.
The daily chart is now close to overbought territory, with the RSI just under the 70 mark. The key daily moving averages are still far below bitcoin’s current price, even if they are now rising fast. The 50, 100 and 200-day MAs are around $7,500, $6,000 and $5,000 respectively.
A look at the higher timeframes offers a picture stretching back two years, and makes it clear that there is indeed resistance around $10k, and then around $12k. If we are to see a significant correction – and that is entirely possible but not inevitable – then there is a good chance it will happen at one of these points. But after $12k, there is very little in the way of resistance. Early in 2018 bitcoin simply fell too fast to establish proper price discovery. There was no consolidation of any real note above $12k (price bounced to $16k after the initial fall, but spent almost no time there).
And that means that if bitcoin can run past $12k and ideally consolidate above it, then we could be in for a very exciting second half of 2019.
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