Bitcoin is the top ranked cryptocurrency by market capitalization, and the most popular to those in the market and outside. For this reason, its price is a major point of consideration for traders and newbies who would like to be part of the crypto world.
The price has been ranging between $8600 and $10500 since the halving in May. The two months after the halving, the market has experienced some action that made altcoins enter the spotlight. Altogether, the main focus is the price of BTC.
Traders and investors and investors are in a constant debate on whether this price is in a bear or bull territory, which can influence market trends. Through these debates though, BTC has to sustain a price level above $8550-$8750. This is because after the March crash, the price has experienced an uptrend, which is categorized by higher highs and higher lows. The latest low was at the $8550-$8750 level.
The importance of such an uptrend is that traders use it to place stop/loss levels. Stop/loss levels are used to help traders make decisions on when to buy or sell to avoid making major losses in their trades. However, at the moment the focus for traders should be on the volume rather than the price, since it has been retracing, albeit slowly.
The volume decreased steadily during the consolidation period after the crash, an indication that the market is not in a move, which would set a new trend. The market would be on a move if there were a heavy breakout above $10500 or heavy breakdown below $8500.
The first quarter of 2018 saw the price of Bitcoin move inside a narrow range, which was significant as it indicated what usually happens during lengthy sideways period and why the current state of the crypto is classified as one.
A drain in volume also characterized the range bound period of 2019 over time. The climax of this volume came with the breakout, meaning breakout traders hit their limit buys while shorters hit their stop/loss.
The chain reaction brought by this breakout triggered a sudden $1000 candle. When the price has lingered in the same range for many months, the breakout is significant and explosive. This is because the longer something ranges in a certain area for accumulated periods of time, the bigger the move once it gets a break.
The theory therefore supports a prospective big move for BTC once it breaks out of the $9000 range that it has maintained for a time now. Traders and market players bored of the same range can hope for a looming breakout that will shake the market and excite everyone involved.
Image courtesy of Pixabay
Don’t worry, we hate spam too
one weekly digest, just the important stuff.
How about some social? Follow us on Twitter!