It spiked to as high as $10,450 on derivatives exchange BitMEX before consolidating at around $10,125 as it attempts to pause before its next major move.
While the macro perspective and higher time frames are clearly bullish, a number of key hurdles still remain on lower time frames before a defined bull market is confirmed.
The first of which is the $10,450 level that was tested during yesterday’s hike in price, with it also being the point of rejection in February following a 50.37% rally since the turn of the year.
If Bitcoin can breakout above the $10,450 level with a daily candle close it will likely make a swift move towards the $10,900 level of resistance, which prevented a move to the upside on two occasions in August and September last year.
However, with it not being out of the woods yet it could still face a sell off in the short term, especially if it fails to break above $10,450 by the end of the week.
A rejection from here would be brutal for Bitcoin as it would demonstrate a clear lack of momentum despite a number of fundamental factors falling into place.
With global economies in desperate times as a result of the coronavirus pandemic, coupled with the ongoing riots in the USA, many believe that the US Dollar will begin to weaken, thus leading the way to Bitcoin, which is known as a hedge to traditional money, becoming inflated.
If Bitcoin fails to do that a large number of investors would lose faith in the asset, which was expected to rise heavily in 2020 as a result of the recent block reward halving that saw rewards slashed from 12.5BTC per block to 6.25BTC per block.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.