BTC/USD
Bitcoin markets initially tried to rally on Monday but then broke down significantly yet again. In fact, we have crashed into the $5000 level, an area that has a lot of psychological importance. The market looks broken at this point, and if we can break down below the $5000 level, I’m not really sure where we go next. Rallies at this point should be selling opportunities, and I believe that the 50 EMA above will continue to offer significant resistance. I think that rallies between here and there are simply going to be nice selling opportunities, as bitcoin is becoming very negative overall.
I can’t see a reason why you would own this, let alone put money to work. However, I understand that some people look towards the future and think that bitcoin is a huge part of it, so you have to be very cautious at this point, understanding that you will have to handle dealing with quite a bit of volatility and negativity. Overall, I think that the market has no interest whatsoever in trying to rally for the time being, and I think that at this point rallies that show signs of exhaustion will attract more attention, and I think also that on the downside we will see major round numbers offer themselves as targets. For example, if we break down from here, the $4500 level would be an obvious level, followed by $4000. Now that we have broken down the way we have, I think that bitcoin is going to come on wound rather drastically. Breaking through the $6000 level was huge as it held up for quite some time. It’s not until we break above the 50 day EMA on a daily close that I would be tempted to start buying.
