Bitcoin (BTC) is all set to finish August with double digit-losses, however a more in-depth take a look at the value motion recommend higher occasions lie forward for the main cryptocurrency.
At time of writing, BTC is buying and selling at $6,940 – down 10.7 p.c from the month’s opening value of $7,727, in keeping with CoinDesk’s Bitcoin Worth Index. Nevertheless, losses would have been a lot greater had costs not recovered from the six-week lows beneath $5,900 seen on Aug. 14.
Certainly, the bitcoin market has witnessed a strong two-way enterprise this month.
Sellers dominated the primary half because the markets reacted to the US Securities and Alternate Fee’s (SEC) disapproval of a Winklevoss bitcoin exchange-traded fund (ETF) in late July. Nevertheless, by mid-August, the bears had run out of steam and the technical charts have been calling for a corrective rally. Accordingly, BTC picked up a bid and moved above $6,400 in the third week.
Notably, the short-term bullish reversal indicators gained extra credence after the cryptocurrency shrugged off the SEC’s rejection of 9 different ETF proposals on Aug. 22.
Additional, BTC/USD brief positions in the futures market hit document lows, signaling the sell-off from the document excessive of $20,000 set in December probably ended across the psychological help of $6,000.
Consequently, the emboldened bulls pushed BTC to highs above $7,000 earlier this week.
So, whereas BTC is reporting a 10 p.c month-to-month loss total, the technical charts point out there’s a purpose to be optimistic going ahead.
As seen in the above chart (costs as per Bitfinex), a protracted wick (tail) is hooked up to the present month-to-month candle, which is extensively thought of an indication of development weak spot – that’s, the bears failed in their try to push costs again to the June low of $5,755 and the bulls regained some misplaced floor.
Additional, the bears have failed 3 times in the final 10 weeks to maintain the cryptocurrency beneath the help at $6,000.
So, it appears protected to say the cryptocurrency has probably charted a long-term backside round $6,000 and therefore costs may revisit July highs above $eight,500 in the subsequent month or two.
- Bitcoin’s long-tailed month-to-month candle signifies the long-term bear market probably bottomed out round $6,000.
- A break above the July excessive of $eight,507 would affirm a bullish reversal.
- A month-to-month shut beneath $6,000 (main help) would sign a revival of the sell-off from the December excessive of $20,000.
Disclosure: The writer holds no cryptocurrency belongings on the time of writing.
Beads picture by way of Shutterstock; Charts by Buying and selling View