Bitcoin is currently flirting with a potential break down in price below the $17,600 level of support after losing momentum on all lower time frames just short of $20,000.
The world’s largest cryptocurrency remains bullish on all higher time frames, which suggests that an all-time high push in Q1 of 2021 is on the cards.
However, in the short term it would not be a surprise to Bitcoin test the prior lows at $16,400. If it bounces before reaching this level it would form a crucial higher low, indicating that the bull run still has room to extend higher.
Key levels of resistance to look out for are $18,250 and $18,600. If Bitcoin can surge and break above these levels on heavy volume, a re-test of at least $19,400 seems increasingly likely before the end of the month.
It’s worth noting that Bitcoin is a volatile asset by nature and that even during the bull market in 2017, corrections of up to 30% were commonplace.
A correction of 30% from the local high at $19,800 would see Bitcoin test the original breakout point at $14,000, which may also be in confluence with the daily 200 simple moving average.
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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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As with any investment, it pays to do some homework before you part with your money. The prices of cryptocurrencies are volatile and go up and down quickly. This page is not recommending a particular currency or whether you should invest or not.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice.