It's Looking Weak, Guys
Bitcoin's recent trendline breakout isn't holding up. Where I think it's going short term, what my "okay, I'm getting nervous" level is, and a quick look at a couple other coins.
I submitted another Bitcoin article to Seeking Alpha this morning. Though my previous article focused on miner profitability and the potential for a bottom in the coin price because miner profitability would reverse, the reality of the situation is Bitcoin hasn’t held up well from a pricing perspective since that article was published and the coin is looking technically weak. There are good reasons for that. For instance, Bitcoin has behaved far more like a Nasdaq STONK than an “inflation hedge.” And with the Nasdaq STONKS at nosebleed valuations, global uncertainty, and looming (we’re told) interest rate hikes, the broad market has been having a temper tantrum for weeks.
The article submitted today was far more fundamentally focused on Bitcoin as a medium of exchange. I’ll potentially offer an SA After Hours whenever that article is published. For now, we can look at some of my technical thoughts and why I think lower prices are coming.
I’ve been sharing some horizontal levels that I’ve seen as support and resistance levels for the short term time horizon. Predictably, Bitcoin couldn’t get over $46k on the first try. I am a bit surprised though that $40k didn’t hold as support. Given the fact that the $40k level was a pretty close marker for the 30 day moving average, I think giving up that level means the trendline breakout (shown above in blue) is going to be back-tested in the coming days. Based on that, $32-33k is the level where I would like to see buyers return.
When we zoom out to the weekly chart, that $33k level aligns pretty nicely with Bitcoin’s 100 week moving average. We can see that Bitcoin is now below the 8 week MA - which paid subs know has been a level that I’ve generally been watching for pivot points for well over a year.
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