Summary
Bitcoin failed to sustain early gains as it struggled against the $108,000 level and the 200-day EMA. The chart looks bearish, with potential downside toward $92,000 or even $85,000 if $100,000 breaks.
Bitcoin
Taking a look at Bitcoin, which doesn’t look so hot at the moment as we tried to get to the $108,000 level but gave back gains as we approached not only that important figure that has been both support and resistance multiple times, but also the 200-day EMA.
The one thing about Bitcoin is it is typically very technically driven, and the fact that it can’t break above the 200-day EMA is not a good look. To the downside, we have the $100,000 level, which, of course, has been a major support level. If that were to give way, it’s likely that Bitcoin falls apart, potentially going to the $92,000 level and then after that, the $85,000 level.
If We Can Rally
On the other hand, if we turn around and rally from here and finally clear that 200-day EMA, it’s actually the top of the candlestick from Monday the 3rd that captures my attention right around $111,000. If we can clear that, then that would change the overall attitude and look of this chart. That being said, this is a market that looks very negative, and I think you’re more likely to fade the rally.
I’m seeing a lot of posts on social media, and it’s an interesting barometer. I don’t know how to quantify it, but a lot of the hopium comes out in these times, and you see posts talking about staying strong and never selling. You have to avoid that and just pay attention to what the price is doing.
Right now, price is telling you that Bitcoin is not an asset people are putting a ton of money into. The volume hasn’t been that great, and quite frankly, the strongest volume days as of late have all been negative. That doesn’t mean that Bitcoin goes to zero. I just think there’s a real threat here that we break down below $100,000. Given enough time, it will present another buying opportunity, perhaps at a 20% discount. That’s not a bad thing, but don’t get stuck with the hopium and the memes and the narrative and all the other garbage that tends to float around. Pay attention to what the price is actually telling you.