Bitcoin markets were relatively positive but quiet during the session on Thursday, as we are awaiting the so-called “death cross” being formed above. This is when the 50 day EMA crosses below the 200 day EMA, signaling that perhaps we are going to continue the longer-term trend to the downside. Because of this, there are longer-term traders that won’t even come close to the market until that rectifies itself. The markets have been very ugly as of late, and even though we have recovered a bit over the last several days, at this point in time it looks like we just do not have enough upward momentum to get this thing moving.
The market is likely to look at the $30,000 level as a major barrier for the sellers to overcome. If they do, then probably we will see this market drop down towards the $20,000 level underneath as the rectangle that we have just been banging around measures for a $10,000 loss. All things being equal, I think that this market is going to struggle until we get some type of resolution to the issues in China. Remember, China is a major source of activity for the block chain and Bitcoin, so until there is more clarity in that part of the world, Bitcoin will probably struggle a bit.
While we were positive during the trading session on Thursday, it cannot be ignored that the volume was very thin, and therefore I do not know how much you can read into the price action other than the fact that it has struggled to rally significantly for quite some time, and the 200 day EMA is sitting above offering resistance. Any signs of exhaustion will be sold into for what I see, and therefore I like the idea of shorting short-term rallies that show signs of exhaustion.
At this juncture, it looks like the market simply does not have the momentum to go much higher: because of that I am truly hoping for some type of break down to take advantage of the market when it is cheap, perhaps building up for the next move higher. This could even possibly be a move below the $20,000 level, but obviously that would take quite a bit of downward momentum.
