(MENAFN- Daily Forex)
- The BTC/USD currency pair bounced a bit Wednesday to show signs of life, gaining over 2%.
- That being said, we still face a lot of noise just above, and in particular at the $24,000 level.
- The $24,000 level is an area that has been difficult to get beyond for a while, so it's not a huge surprise to see that this market has not necessarily taken off to the outside during the day.
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The 50-day EMA sits at roughly $21,000 and is rising, so that could be dynamic support on any type of pullback. Bitcoin has had a little bit of a resurgence over the last couple of weeks, but it is choppy to say the least. In fact, it almost looks like we are trying to form some type of basing pattern, so while it is bullish in its intention, that does not necessarily mean that we get some type of big rally. It's possible that we could be in a major accumulation phase, but it does remain to be seen whether or not that's going to be the case. After all, Bitcoin is pretty far out on the risk appetite spectrum, and risk appetite is somewhat all over the place currently. In this environment, it's difficult to risk a lot of money on any one particular asset, let alone something with the volatility profile of Bitcoin.
If we do break down from here, the $20,000 level will be crucial support. Breaking through that could be quite a bit of a blow to the Bitcoin traders out there, perhaps making them scramble and kicking off the next wave lower. It's not necessarily going to be an easy move or trade to get beyond, but I do think that given enough time this is a market that will have to make a bigger move. If we break it down, then $12,000 could be your target. If we rally from here, the $28,000 level will be the beginning of significant resistance it extends to the $32,000 level.
Breaking above the $32,000 level then allows for a longer-term move, perhaps to the $40,000 level. I don't see that happening anytime soon, but if it does, all you can do is follow the market because at the end of the day, price is everything.
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