Bitcoin Analysis
Bitcoin has rallied quite nicely during the trading session again on Thursday as we are challenging the $120,000 level. This is a market that I think is a little overextended over the last couple of days and I would be very cautious about the volume at the end of the day. If the volume stays basically where it’s at, I think we probably get a pullback.
That pullback should end up being a buying opportunity. I don’t necessarily think that it’s anything negative. And ultimately, what I would really prefer to see here is some type of short-term pullback that then finds a bit of a bounce, maybe down to roughly $117,000. If we continue higher, then I think you probably have a pretty significant barrier right around the $123,250 level.
Above there, then we really start to take off. Now, the trick of course with Bitcoin is that it tends to move sideways for quite some time and then just gets these massive impulsive runs. Are we in the middle of one? Maybe, maybe people are using this government shutdown situation as a reason to think that Bitcoin is going higher. I don’t think that is a long-term issue quite frankly.
Even if it were, we probably have bigger problems two years down the road. I don’t necessarily think people will run to Bitcoin to finance transactions. But really, at this point, Wall Street will look for the reason to push their ETF. I still like the idea of buying dips. I don’t necessarily think you want to chase wildly here.
Gold Analysis
Looking over here on the gold market, you can see it’s been a very choppy trading session and really why wouldn’t it be. Quite frankly, over the last basically two months or so, maybe even going back about two and a half months, it’s been straight up in the air and sooner or later we are going to have to see some type of pullback. I would love to see a pullback to the $3,800 level if we get that opportunity. Keep in mind that we had previously been in an ascending triangle for months.
That measured for a move to roughly $3,800. And we have in fact seen that move fulfilled. So, I think $3,800 is a decent candidate for buyers to come back in and try to take advantage of market memory and just basically potential support. Anything below opens up a move down to $3,700, which I think also makes a certain amount of sense.
Given enough time, gold looks like it’s definitely going to at least try to get to the $4,000 level. I think once you get this close, there’s a natural proclivity for the market to try to reach the next big thing, in this case, $4,000. Much like Bitcoin, I like the idea of buying dips in this market. I would love to get an opportunity to buy gold somewhere near $3,800.
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