Did BTC Find Its Big Round Number?
Bitcoin bounces overnight and continues to hold $19k
Cheat Sheet -
Support and resistance levels and our daily, weekly and monthly bias on BTC, ETH, OIL, ES, and NQ as well as our favorite altcoins.
Crypto News
Magic Eden COO calls 0% royalties a 'prisoner's dilemma' (The Block)
Sam Bankman-Fried draws fire from DeFi proponents after regulation proposal (The Block)
PancakeSwap eyes Aptos following Ethereum integration (The Block)
Plaid Unveils ‘Wallet Onboard’ Tool, Promises Crypto Product Push (CoinDesk)
Binance Denies Allegations That It Intends to Use Users' Uniswap Tokens for Voting (CoinDesk)
Kraken crypto exchange is next to close doors to Russian users (CoinTelegraph)
Leaked Draft of US Congress’ ‘DeFi Killer’ Bill Sparks Debate (Blockworks)
South Africa Defines Crypto as Financial Product (Blockworks)
US Chamber of Commerce Rips SEC for Denying Proposed Grayscale Bitcoin ETF (Blockworks)
FTX Recovery Plan Could Reimburse 72% of Voyager Users' Funds (Decrypt)
Warner Bros Releases Ethereum-Compatible ‘Lord of the Rings’ NFTs (Decrypt)
BTC Outlook
If you missed it or need a refresher, check out Hal’s article from last year about how Bitcoin traded in the 2018-19 bear market. The key point to the article is after all the selling Bitcoin found consolidation for over a year around a Big Round Number, $9000. And now, after nearly a year of downward price action Bitcoin does appear to be settling on a big round number : $19000.
Bitcoin has traded under $19k only 19 days in the past 2 years. Note too that this is the level Bitcoin capped out at in 2017 and also in Nov-Dec 2020 Bitcoin spent over a month flirting with this level.
The longer Bitcoin trades around $19k the more investors and traders begin to consider it the fair value. This means people start to perceive under $19k as cheap and anything over it as expensive. This could be the setup for a 2019 style bull market. This would look like BTC eventually rallying away from $19k for some months but eventually returning and even going under this big round number. It is very unlikely that if $19k is the long term support that the absolute bottom for this bear market is not in yet. But, just like we said there could be short to mid-term bullish momentum that could last months before this level is broken.
The opposite could play out as well. The main point is regardless if the price goes down from here or up, it will likely be drawn back toward $19k as a big round number that market is contemplating as the “fair value”.
Possible Course of Action
Long near $19k as it continues to act as support
Short if $19k begins to act as resistance
The Bulls’ Defense:
The price reclaimed $19k again
The Bears’ Prosecution:
Price continues to test support, a catalyst could send the price lower
A Closer Look
This section will be focused on taking a closer look on what Hal thinks is important to watch in the coming week.
This morning Hal reviews Bitcoin dominance and what it means for altcoins in the coming quarter.
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