Bitcoin fell on Friday, initially testing the $11,500 level before selling off to end the day in a pretty bearish candle. That's not to say this means the short-term uptrend is dead and in the grave, but this shows it would be prudent to monitor support levels as selling off into the weekend is usually not a good sign in any market.
(October 16, 2020 8:00 PM EST)
Outlook: Bitcoin dropped on Friday, erasing yesterday's gains and going into the weekend with a slightly negative bias. This goes for all markets, as equities and gold both sold off into Friday's close as well. This could signal a volatile next couple weeks as we are now less than 3 weeks from the US Presidential Election, and COVID cases spiking in certain cities around the world, I expect to see a lot of volatility in the near future. Of course, there could be huge spikes up; that is what volatility is; big swings in both directions. However, expected volatility and uncertainty in markets usually leads to assets reverting to the mean (overextended equities), and investors taking risk-off bets, taking profits and moving into cash and bonds. This could lead to equities/gold weakness and US Dollar strength, which, as we have explained in previous articles, BTC tends to move opposite the US Dollar and closely with that of Gold. This is a situation we'll be watching closely, so make sure to follow us and look for daily market recaps and price forecasts as we look to navigate choppy waters ahead.
Support: Look for support below at the $11,000 level which is not much higher than the 50 Day EMA around $10,814. This area, formerly resistance, should act as new support for BTC. If not, then perhaps BTC isn't ready to make a move higher just yet, and we'll see BTC remain trading in a $1,000ish range until an impetus causes it to do so.
Resistance: I'm looking for an impulsive candle above $11,500 and then see what kind of selling BTC runs into around $12,000. After that, I don't see a ton of resistance between there and $20,000, so it might come quicker than most expect. Gold continues to shed off weakness; I expect BTC should parry any attempts even better.
If you enjoy these posts, please support the channel by "Tipping" this post below, or using either of the referral links below.
They cost you nothing and give me a small reward, which makes me a little happier to share these personal analyses with you at no cost.