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Bitcoin - Price Behaviour

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Bitcoin is looking very bearish at the start of 2020. This bearishness is going to scare a lot of investors and traders alike. 

I see the 'blue rectangle' now as a critical price zone. Should Bitcoin break below it then it could be in trouble and further downside price behaviour may follow. If it can hold in it or above it then we could see a strong foundation for a further upward move. Until this is resolved I can see Bitcoin moving in a range bound and sideways price action.

Bitcoin_20200102_19_38.png.9bb9d71ce9472b568cb2822ff3bc4775.png

 

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Bitcoin is charging upwards today along with Precious Metals and Bonds.

Bitcoin's price behaviour is similar to a defensive asset like Gold and Bonds today.

The one thing I have experienced over all the years I have been following and trading Cryptocurrencies is that when there is any form of MILITARY CONFLICT then Bitcoin tends to go up. There are past examples with the US and North Korea to highlight this point possibly in this thread or other threads that I have been involved in. 

 

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Bitcoin touched $8012.30 overnight. 

Yes Bitcoin did cross its 100 DMA on the 'daily' it has not closed above it yet. This should be imminent. It needs a move above $9k to meet its 200 DMA which is going to be tough but we all know Bitcoin can rise sharply on sentiment and momentum very quickly. 

Bitcoin_20200107_06_47.png.4d60a9b8760e9134d9cde7ddaebde496.png

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$8.2k has been touched today by Bitcoin.

From an investment perspective I wonder if this is the 'Whales' in play or whether we are seeing large institutional capital flowing into Bitcoin? It could be neither and just pure speculative price action based on technicals alone.

I have seen no evidence that money flowed into Bitcoin due to Iran-US tensions but its price sure does react to US tensions with other countries around the world such as North Korea and the Middle East.

What we may witness now is 'Bitcoin Accumulation' from an investment perspective as Bitcoin investors prepare in anticipation for a large price increase due to the halving event in May 2020. 

I myself have acquired a small amount of physical Bitcoin and opened a Crypto Wallet for the first time during the Christmas holidays in anticipation for the potential of any big move in price. My timing could not have been better. I also wanted to see how easy it was to physically acquire Bitcoin and use a Crypto Wallet and I must admit it was far easier than I thought. 

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The question most high risk traders are asking is whether Bitcoin is 'breaking out'?

It has broken out of its recent trading range, that is for sure. Will it lead to an upward and bullish trend will all depend on the demand for physical Bitcoin. This is where Asia plays an important role. If the likes of the Chinese, Japanese, Koreans, Vietnamese, Indonesians, etc. begin physically accumulating Bitcoin then we could see a large move upwards. If not then I fear that speculation may temporarily move it upwards before it comes crashing back down again showing extreme volatility.

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I am expecting Bitcoin to have another go at staying above $8k. If it can then it can attempt to build another move towards $9k. The more stable this is the better for Bitcoin longer term. 

One of the arguments against Bitcoin is that it is far too volatile. So what longer term Bitcoin investors don't want to see is a quick and sharp move upwards. This is what the traders want to see. Investors and accumulators was to see a steady and robust move upwards with solid foundations and support along the way. 

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I do wonder if there is another move down into the $6k price level left?

If you draw trend lines on the 'daily' for Bitcoin then you will appreciate why I think that. 

Bitcoin is still making a series of 'Lower Highs' and this is bearish on the 'daily'. 

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When looking at Bitcoin on the 'daily' then it needs to break through the $9.5k to $10k price level. See the 'blue rectangle' in the chart below.

Bitcoin_20200115_18_43.thumb.png.b81ada3bec2cdddff455df41e7aca6a7.png

 

$10k is a psychological price level which I believe will trigger an influx of buy orders and drive the Bitcoin price upwards like a rocket. 

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There you go Bitcoin has hit $9k. For me now $10k is a realistic price target and if that gets crossed then boy could we see a monumental move in Bitcoin with the potential halving narrative only 3-4 months away. 

For any high risk and aggressive trader I would want even a small position in Cryptos should a humungous move occur. 

I am not suggesting that Bitcoin is worth $10k or anything like that but this is the market dynamics in force here which is so strong. Large hedge funds are going to go long Bitcoin to try and profit as much as they can as the speculators and herd try to profit from this Bitcoin halving narrative. 

 

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I got an email from Money Morning today, claiming that a top hedgefund manager had developed an amazing Bitcoin system - and if you spend a few thousand pounds buying it it will increase your gains by 360%!  I thought that this organization was fairly reputable but they are clearly selling sh!tty scams ...

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@dmedin,

Do not spend any money on any such system. Ask yourself why someone who has developed an amazing system would sell to the likes of me and you? That top Hedge Fund Manager should be trying to sell to the largest investment banks in the word who trade Cryptos but they would develop their own or only acquire the best.

Also specifying a gain of around 360% is ludicrous as it could be far greater or far less. Who knows. 

I don't know about scams but ask yourself why this amazing Hedge Fund manager did not sell this system when Bitcoin's price was declining? There were serious profits to be made on the way down by shorting as trading Crypto's profitably is all about 'shorting' it when the price declines and boy does the price decline a lot over a period of time. Long only can only generate certain returns and I personally believe trading Cryptos is all about trading both on the 'long' side and 'short' side which is what I would expect from the top Hedge Fund managers. 

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I do see Bitcoin hitting around $9160 - $9180 in the shorter term. 

However if it crosses the 'blue rectangle' which I have highlighted then it could have a real go at around $9.5k to $10k and if this gets beaten then I think it could be game on and encourage increase capital to Bitcoin. The 'blue rectangle' is the short term price area which Bitcoin needs to break. 

Bitcoin_20200118_14_40.thumb.png.23864e6ec8a47cc390c42a0979aab730.png

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Bitcoin touched $9198.50 on IG's platform and I believe hit $9.2k and more on certain exchanges. My shorter term price target was hit as per my shorter timescale (see previous post). 

Bitcoin's price action is still bullish when you look at the 'Relative Strength Index' (RSI) and 'Moving Average Convergence Divergence' (MACD) on the 'daily' and both are still in bullish zones.

A lot of traders were waiting for the Bitcoin price to decline to $6,000 and below to $3,000 again. So called experts and well respected individuals came out and stated as such. This has not materialised and Bitcoin now is more likely to hit $10,000 than hit $6,000 or $3000 based on odds and probabilities. 

For me trading is all about serious consideration of the price being more likely to move to a certain price area than not based on stronger odds and probabilities. That is a very important part of my trading strategy. This serious consideration has helped me in the past many times and ensured I did not miss out of big trends when eliminating all the 'market noise'. 

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Wow that big drop of around 500 points is sure going to shake out those traders with tight stop losses. 

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There is something interesting in the price behaviour of certain assets at this specific moment in time. 

So right now Bonds were going up and so too were Gold and Silver. That seems right to me. Indices were going down which again seems in line but then Bitcoin was going up. So today Bitcoin was behaving more like a 'Safe Haven' Risk Off asset rather than a Risk On asset.

It is this that is very interesting in Bitcoin because it can behave like both Risk On and Risk Off when it wants to. This special characteristic is unique in Bitcoin for now. Of course this may well change in the coming future but for now it is able to be both at certain times. 

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When you look at the 'daily' Bitcoin is still participating in the downward trending price behaviour until it clears $10k for me and stays above it for any meaningful or significant time period. 

Bitcoin_20200126_09_30.thumb.png.ccba7ede64423ef0fbcb3865d8e4e978.png

For me no upward trend on the 'daily' timeframe has been confirmed/established as of yet. It is getting close but just not there yet. 

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Bitcoin is looking to break out and move towards $10k but this is Bitcoin and it never does things as expected. I have no doubt that at some point in the near future Bitcoin is going to hit $10k. The market will make sure it hits $10k but the way it will do it is going to be so sudden and quick that a lot of traders will not even realise that Bitcoin touched the price point of $10k. 

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Bitcoin touched $9444.90 overnight. $10k is going to be a tough nut to crack but if and when it does I expect Bitcoin to bulldozer through totally unexpectedly and suddenly catching a lot of traders out. 

If you look at the 'daily' then Bitcoin since last Friday as been in bullish mood. It is arriving at a critical juncture in my opinion where it will have to decide whether it is going to break through and continue in an uptrend towards more recent highs or keep the bearish downtrend in tact and go south. 

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The question a lot of people are asking me is whether Bitcoin will hit $10k? I think is more likely to hit $10k than not based on price action, momentum, trend strength, halving event, interest, etc. 

Of course the price behaviour will confirm shortly but I am expecting Bitcoin to touch $10k intraday very soon. 

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I think Bitcoin is getting very close to hitting $10k. It has strong momentum behind it right now after a period of consolidation and I think it is inevitable that $10k will be hit soon. 

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I much prefer this current price behaviour of Bitcoin.

It is making a series of 'Higher Lows' and 'Higher Highs' on the daily. This is much healthier than just an upward rocket like movement which then comes crashing down. The current trend may prove to be more sustainable with of course large corrections along the way but it could be different from past trends. 

 

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I have one eye on this weekend. I have seen some of the biggest moves occur during weekends when it comes to Bitcoin. I would not be surprised at all to see Bitcoin touch $10k at some point before Monday morning.

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So Bitcoin finally hit $10.1k overnight. I was fully expecting this based on the current price behaviour. 

This could potentially create a buying frenzy on Monday and for the rest of the week as buy orders are triggered that have been waiting on the sidelines for this price to be met. There could be buying pressure or equally there be a lot of sells driving the price down due to profit taking. Those same profit takers then may re enter again so there are several scenarios that could play out. 

I am anticipating further upward price behaviour with large corrections along the way prior to the halving event. 

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It seems we are seeing some profit taking around the $10k level. I still see Bitcoin going back above $10k once the profit takers have finished. 

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Bitcoin hit $10,400 today so the gradual increase in price is coming. Overnight during Asian market opening times should be interesting. 

I am looking for Bitcoin to surpass $10.5k and then go for $11k where it may face some resistance. 

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I was reading today where so called Crypto experts (beware of the bias) are predicting the real price rise in Bitcoin to begin next in 2021 or after the halving event in May 2020. 

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For those who want exposure to Bitcoin but do not want to use Spread Betting or CFD's then there is another option which I have been using for several years now which is XBT Provider One. I have a thread on this for those that are interested. 

All I will say is that these are high risk derivatives (Exchange Traded Notes) that are more for institutional or professional investors. They are similar to an ETF and the FCA are looking into banning them for retail clients. I personally think they are brilliant investment products for Bitcoin and Ether. I have been using them and it is a nice clean and easy way to add exposure to this asset class in your investment portfolio without having to trade the asset or physically acquire it. From an investment perspective it meets my requirements. 

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Bitcoin has dropped sharply today (Saturday) and gone well below $10k which will certainly trigger a lot of stop losses. I am used to seeing this and to be honest does not surprise me as this has constantly occurred over the last few years. 

 

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The CME Chart is still providing a CME gap of around $11,600 which is a potential indicator that Bitcoin may look to revisit this price. 

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