BTC/USD is trading near the 16,450.00 mark as of this writing. The month of November has not been kind to Bitcoin or the cryptocurrency world in general. Another major crisis became headlines as the FTX exchange faltered and evidence of mismanagement and corruption emerged. Worries about the core financial infrastructure of exchanges for digital assets has certainly caused speculative ‘fever’ to suffer from flu like symptoms and the decline of values to be quite clear.
Behavioral Sentiment in Cryptos and Bitcoin will not Recover Quickly
Yes, I know, cryptocurrency ‘experts’ of Bitcoin will say that BTC/USD is not like other digital assets, that it is not part of the various poor infrastructures and potentially criminal activities witnessed recently in other crypto spheres. Bitcoin may remain a true asset which proves over the long-term it has value, but in the short-term and mid-term it may prove difficult to convince people to buy it with speculative fever. And let’s be truthful, outrageous speculative fever is what is needed to make BTC/USD jump higher energetically.
From a trading perspective, BTC/USD continues to linger within dangerous lower realms. Bitcoin’s inability to reverse higher above the 17,000.00 and 18,000.00 levels is telling and if the price of BTC/USD remains only flopping above only 16,000.00, there is reason to suspect it can still go lower. Who is running out to buy Bitcoin right now as a long-term investment? Since November the 11th the price of BTC/USD has essentially hit a ceiling and has not shown much ability to climb.
- Trading volumes of BTC/USD have greatly diminished and it appears that those holding Bitcoin are hoping that a reversal higher is sparked. If the price of BTC/USD drops below 16,000.00 and is sustained a move beneath the 15,000.00 could force more selling – capitulation – and drive BTC/USD lower.
- The low of nearly 15,500.00 on the 21st of November tested values last seen in January of 2020. While ‘influencers’ of Bitcoin always say steep reversals lower are expected and a bounce will surely come, doubt and a lack of buyers has darkened the horizon.
- Trading near three year lows does not help BTC/USD either.
Technical Lows have Proven Weak and Consolidation Dangerous for BTC/USD
Speculators who remain bullish on BTC/USD need to remain realistic. Reversals higher have certainly been seen, but it is hard to argue that consolidation and a lack of ability to sustain upwards momentum is a good thing. The fact that BTC/USD has not reversed upwards sharply, after suffering a major disruptive selling burst starting around the 6th of November and blossoming into widespread selling panic on the 8th is not a good sign.
BTC/USD Outlook for December:
Speculative price range for BTC/USD is 13,600.00 to 17,800.00.
If BTC/USD continues to remain barely above 16,300.00 to 16,400.00, this may be a signal some cryptocurrency speculators are trying to hold on but may be forced to sell additional holdings. If BTC/USD drops below the 16,100.00 level near-term and is not able to bounce above this mark, traders cannot be blamed for thinking the 15,900.00 is a target again. Bitcoin can still trade very quickly, when price velocity is part of the action sudden and violent moves should be expected. Unfortunately a lot of the volatility has been to the downside.
If another bad ‘news event’ were to unfold in the world of cryptocurrency and BTC/USD were to find itself challenging lower depths below 16,000.00 this would not be a positive sign. Any move below the 15,700.00 with sustained price action could be a sign that BTC/USD is about to challenge new long-term lows. A move below the 15,000.00 level would not be total surprise for Bitcoin in the month of December.
Day traders trying to take advantage of BTC/USD face a very difficult task because of transaction fees and spreads that are often too wide. Using leverage when day trading BTC/USD by speculators should be done with extreme care because losses can quickly happen if the wrong direction is chosen, it might prove better simply watching the World Cup and relaxing while cheering for your favorite team.
Traders who choose to try and pursue upwards momentum in BTC/USD may be eternal optimists. They may be proven correct, but buying Bitcoin and looking for climbs may be best done when support levels are perceived near the 16,000.00 mark if it holds. Needless to say stop losses should be used. Bitcoin would likely have to climb above 17,800.00 and sustain this level sincerely for BTC/USD to gather buying firepower.
How likely is this?
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