Bitcoin surged above the $7,000 resistance and reached the $7,200 bullish target against the US Dollar. BTC price is currently correcting lower and it could test the $6,500 support area.
Yesterday, we discussed the chances of more upsides in bitcoin after it broke the key $6,500 and $6,600 resistance levels against the US Dollar. BTC did trade higher and broke many important resistances, starting with $6,800.
The bulls gained pace and the price rallied above the $7,000 resistance. The price tested the $7,200 target (as discussed yesterday) and settled well above the 100 hourly simple moving average.
A new weekly high is formed near the $7,273 and the price is currently correcting lower. It broke the $7,000 level, plus the 23.6% Fib retracement level of the recent surge from the $6,156 low to $7,273 high.
Bitcoin even traded below the $6,800 support area. However, the decline was protected by the $6,700 region. It seems like there is a key bullish trend line forming with support near $6,715 on the hourly chart of the BTC/USD pair.
The 50% Fib retracement level of the recent surge from the $6,156 low to $7,273 high is also acting as a strong support. If the price fails to stay above the trend line support and $6,700, it could extend its downside correction.
The main support is now forming near the $6,500 area (the recent breakout zone), where the bulls are likely to take a strong stand in the coming sessions.
If bitcoin remains well bid above the $6,700 and $6,500 support levels, it is likely to continue higher. An initial resistance is near the $7,000 level.
The next key resistance is near the $7,200 level, above which the price is likely to surpass the recent high of $7,273. Any further gains could lead the price towards the $7,500 resistance.
Hourly MACD – The MACD is slowly gaining momentum in the bearish zone.
Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is still well above the 50 level.
Major Support Levels – $6,700 followed by $6,500.
Major Resistance Levels – $6,900, $7,000 and $7,200.
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Bitcoin Briefly Tops $7K as Traders Say Worst of 2020 Selloff May Have Passed
Bitcoin (BTC) rose Thursday for the fourth straight session and briefly climbed above $7,000 for the first time in three weeks.
The bellwether cryptocurrency was up 2.5 percent to $6,821 as of 19:22 UTC (3:22 p.m. in New York.) Earlier, the price rallied as high as $7,236 before pulling back.
The four-day increase has helped bitcoin claw back some of its losses during the first three months of the year, when the spreading coronavirus and increasingly dire economic prospects sparked a flight for cash among investors in both traditional and digital-asset markets.
Joe DiPasquale, CEO of BitBull Capital, a San Francisco-based hedge fund specializing in cryptocurrencies, said he saw no clear driver of Thursday’s move. Market signals show a growing conviction among bitcoin traders that prices won’t fall below $6,000 in the short term, but rallies above $7,000 appear to be drawing in sellers, he said.
“You have so many people trying to swing trade on crypto,” DiPasquale said in a phone interview.
Traditional financial markets were whipsawed again as Wall Street investors speculated that major oil producers including Saudi Arabia and Russia might agree on production cuts to help to stabilize prices. Oil jumped 22 percent to $24.77 a barrel, and the Standard & Poor’s 500 Index rose 2.3 percent.
The S&P 500 is still down 22 percent for the year to date, while bitcoin has now trimmed its 2020 losses to just 5.5 percent.
DiPasquale said many bitcoin traders are looking ahead to May’s expected “halving,” when the supply of new units of the cryptocurrency issued by the underlying blockchain network is scheduled to drop by 50 percent. The once-every-four-years-event was coded into the 11-year-old bitcoin’s original programming as a way of minimizing inflation.
The halving comes as the U.S. Federal Reserve is poised to inject an estimated $4 trillion of new liquidity into the global financial system to help stabilize markets, roughly equivalent to the total amount of money created on the central bank’s balance sheet since its founding in 1913. Investors including Mike Novogratz, CEO of the cryptocurrency-focused investment firm Galaxy Digital, say such moves could “debase” the value of the dollar.
“That literally is a printing press,” Novogratz told CNBC on Thursday. “I’m getting calls from real big investors we’ve never seen before, saying, `Tell me about this bitcoin.'”
Novogratz said he expects bitcoin’s price to double within the next six months and potentially climb above its previous record near $20,000 by the end of the year.
Marc Hochstein contributed reporting.
UPDATE (April 2, 21:00 UTC): An earlier version of this article misstated the date of the last time bitcoin traded above $7,000. It was March 12, not 11. The article has also been updated with new information.