Bitcoin Fails to Break $21,000, Is Up Still in Play?
October has been a historically bullish month for Bitcoin, but with the slow start to the month going into the last week of the month, it is understandable why a deviation from the norm was expected. However, this sentiment was quickly erased as the crypto market had taken a positive turn on Tuesday. By the end of the trading day on Wednesday, BTC’s price had passed $20,000. But what does the $21,000 rejection say?
Bitcoin fails to break $21,000
Even with the momentum of the last two days, bitcoin had faced a hard rejection at the $21,000 level. Bears had quickly built up resistance at this point, and the shorts in the market in anticipation of a downward correction had helped energize this resistance.
So now, while the outlook for bitcoin remains very positive, $21,000 is currently the point to hit, which would be an easy pick in a bull given the recent rally. However, the crypto market has hampered the growth of digital assets and investors remain very cautious despite the market gains.
The next step will be for bulls to strengthen support at $20,500 in anticipation of the next retest. Because if bitcoin faces such a strong rejection at $21,000 again, bears will likely try to pull the price back to $20,000. At this point, the next support level is just below $20,200, which is not as strong as the $20,500 support.
BTC holding support at $20,500 | Source: BTCUSD on TradingView.com
What’s next for BTC?
The $21,000 rejection hasn’t phased the market much, given the euphoria that the digital asset finally hit $20,000 again. Instead, the bulls have now come out of the woodwork and optimistic forecasts are flying around.
Jim Messina, ex-President Obama’s chief of staff has been one of the most bullish during this time. Messina appeared on Fox News where he said he expects the digital asset to actually recoup $60,000 and said he’d bet Porsche on it. It follows bullish forecasts from others in the space, such as ARK Invest’s Cathie Wood who pegged the digital asset at a price of $1 million apiece over the next 8 years.
However, it’s important to note that bitcoin’s trading volume has been trending down over the past 24 hours, which could indicate a quick burnout of the recent spark. Such declines in momentum can be damaging, especially during periods of short-term growth that have been recorded. The next possible point for bitcoin would be to try to break above $21,000 when you move. But if this does not happen, it is possible to see the digital asset under $20,000 once more.
On a more positive note, sell-offs in BTC have reversed over the past two days. Bitcoin’s move above its 50-day moving average has turned indicators in the near-term green, and there is now increasing buying pressure that is expected to continue into the weekend.
Featured image from MARCA, chart from TradingView.com
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