Bitcoin has initially tried to rally during the day on Thursday, but the $60,000 level could not hold as support. That being said, we have found a little bit of a bounce at the 50 day EMA, which in and of itself might be something worth paying attention to. It is also worth noting that the bullish flag that we had formed has now been violated, so that does show a bit of a change in attitude. Because of this, little bit more caution may be called for, but quite frankly Bitcoin has a long way to go based upon various metrics and therefore I still remain bullish, despite the fact that we have seen such a significant selloff as of late.
This is normal for Bitcoin though; you need to understand that it is not like trading a stock or even the currency pair. This market is extraordinarily volatile and as long as you know that going in, you can understand that this pullback will more than likely end up being a buying opportunity. While that is a bit of a lazy way to look at this, the reality is that the market has no signs of breaking down from the longer-term standpoint, and the fact that the 50 day EMA has held is of course very bullish and of itself. The market will continue to look at the 50 day EMA as potential support, as it does typically attract a lot of attention. Underneath there, then you have the $55,000 level, an area that has a certain amount of psychology attached to it. After that, then you have the $50,000 level which is even more psychologically important than $55,000. In other words, this becomes a major “buy on the dips” type of market. That is the way most crypto has been for a long time, so I do not see this changing anytime soon.
If we do break down below the $50,000 level, then I might be a bit more concerned about Bitcoin, but right now it seems like a very unlikely turn of events, so I believe that we have further to go to the upside rather quickly, and this pullback will be looked at as a potential gift by most traders.
