Bitcoin goes into the typically low volume weekend with a sense of relief after it finally managed to climb above the $33,000 level of resistance on Friday.
The apparent breakout follows a frustrating 24-hours in which the world’s largest cryptocurrency failed to conquer $33,000 despite five meaningful attempts.
Attention will now turn to where Bitcoin futures will close on CME at 11pm UTC this evening. A close above $33,400 should signal that the cryptocurrency market will be relatively safe from downside price action over the weekend.
It’s worth noting that all higher time frames remain in a bearish posture, with the recent daily death cross adding to the downward pressure.
The daily 50 exponential moving average has now ticked down all the way to $37,300 having been above $43,000 just a fortnight ago. Testing this moving average before the next major move seems most likely, as a break above would indicate a shift in short term momentum.
One factor that’s certain to be a key to Bitcoin’s trajectory over the coming weeks will be whether it sees a significant increase in trade volume. Currently, 24-hour volume is regularly below the $30 billion threshold, which is 50% lower than two months ago when it often topped $60 billion.
If volume continues to subside, it paints a miserable picture for Bitcoin bulls who may believe that cryptocurrencies are destined for more upside over the course of 2021.
However, Bitcoin has a habit of going against the grain and causing a surprise when all odds are against it. If it can take out the well-fortified level of resistance at $42,000, it would demonstrate a clear change in behaviour that would replicate the ‘double bubble’ market of 2013.
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In August 2008, the domain name bitcoin.org was registered. On 31st October 2008, a paper was published called “Bitcoin: A Peer-to-Peer Electronic Cash System”. This was authored by Satoshi Nakamoto, the inventor of Bitcoin. To date, no one knows who this person, or people, are.
The paper outlined a method of using a P2P network for electronic transactions without “relying on trust”. On January 3 2009, the Bitcoin network came into existence. Nakamoto mined block number “0” (or the “genesis block”), which had a reward of 50 Bitcoins.
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Disclaimer: The views and opinions expressed by the author should not be considered as financial advice.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.