BTC/USD
The bitcoin markets rallied during the thin trading session on Monday, as the Americans were away for the Labor Day holiday. However, when I look at this chart I see a downtrend line just above that I think the market will test soon. Because of this, I think the next couple of days could be slightly positive, but the real fight begins of the downtrend line. I would also want to see a “higher high” form on the daily chart, meaning that we need to clear the $8300 level before I’m truly impressed. I think that’s the fight we are about to have, I expect that we will have a lot of volatility just above.
Underneath, I see support at the $7000 level now, and I think that the buyers will return if we go back to that level. If we were to break down below the $6800 level, then I think the market would probably drop back down to the lows again. We are most certainly coming close to some type of decision, but I would be very cautious about throwing all of your trading capital into the market in one shot, because regardless of which direction we go, we are at a major inflection point, and that can quite often cause a lot of erratic and dangerous moves. If we do break to a “higher high”, then it’s an entirely different market. We would probably target the $10,000 level next. Otherwise, if we rollover I think the $6000 level will be targeted yet again. While it has looked good over the last couple of weeks, bitcoin still has not cleared the resistance that we are approaching. Things are looking up recently, but we need to answer some serious technical questions to put longer-term money to work, something I think we are about to do.
