Bitcoin rallied again on Thursday, continuing its breakout north of the $13,000 level, closing the day around $13,100. This level is probably one of the last points of real resistance Bitcoin might face before the 2017 ATH at $20,000.
(October 22, 2020 8:00 PM EST)
Outlook: Bitcoin continued its ascent Thursday, making for a very bullish week, breaking through two resistance levels and establishing a new short-term uptrend to boot on top of what are probably developing medium- and long-term uptrends. Bitcoin is bullish but overly so, rallying accordingly to bullish PayPal news, bullish fundamentals, the perfect macro economic environment for an asset like BTC, and a chart that in every sense supports buying momentum. There is no way I'm shorting BTC at any level, maybe not even in the six-figures if/when BTC gets there. For now, let's focus on the near-term and see what BTC does with the $13,000 level, which is the 2019 high and a major stepping stone to higher five-figure prices. I think the only way to trade this market is to buy dips, as selling is too risky and can blow up your account in a minute, or worse, lose some of your stack as we look for an official 2021 bull market where you'll want as much BTC as possible.
Support: Look for support around $11,000 which is former resistance and near the 50 Day EMA. Below that, $10,000 should be a huge support level, which is also now buoyed further with the rising 200 Day EMA just below. I don't quite consider $10,000 to be my line in the sand quite yet, but I do view it as the single strongest near-term support level of Bitcoin.
Resistance: Watch to see what happens around the $13,000 level, as Bitcoin will probably digest a bit of these gains before accelerating- or not. Bitcoin has a penchant for starting to look normal and predictable at times, and that is precisely when you wake up the next day to a huge green candle blowing away what you thought might be resistance. However, there will probably be a bit of resistance every $1,000 as Bitcoin ladders up to $20,000. In fact, $13,000 was the 2019 highs, so that would be a natural resistance point, and probably the last major one before $20,000. Even if Bitcoin retraces from $13,000, that's okay, because just reaching it again shows that we are in an uptrend and grinding higher to levels not seen in well over a year. It might be a bit of a grind higher, but that's okay, because that is indicative of a healthy market. Bitcoin is just getting started, buckle your seatbelts.
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