Bitcoin tree-hugging at $10,000 level – Analysts mixed on next direction


Suddenly, Bitcoin “watching” has become boring. There had been some expectations that this weekend might bring a groundswell of support, based on a contentious G7 meeting and the fact that S&P futures were in the toilet, due to tariff wars, but such was not the case. Yes, Bitcoin jumped up on Friday in anticipation of continuing chaos in the international ranks, but it quickly gave back those gains, leaving us with an empty pit in our collective stomach for what might transpire in the week ahead.

In times like these, Bitcoin tends to paint a picture of uncertainty, with a knowledge that the clock is tickling, emblematic of the converging triangle or wedge or whatever you choose to describe its current price behavior. This chart recently appeared in a Forbes article, where the author stressed the lack of conviction on the part of the market. BTC volumes, as measured by the top ten exchanges, have been in decline, as is typically the case with this type of formation. It is curious that the convergence point is the launch date for Bakkt, but you can expect more volatility earlier than that, with a break out.

As I check the latest quotes, Bitcoin rests just above $10,000, treading water once again, as if that is the only posture that it can assume. The upward thrust provided by the Bakkt announcement has come and gone, yesterday’s news with little afterglow to provide comfort. But, as the launch date approaches, things could get interesting, Analyses of this pattern suggest that 54% of the time a strong break out occurs in line with the previous prevailing trend. These odds may sound good, but they have been derived from traditional market behavior, and Bitcoin has been anything but traditional.

And so, we are back to a choppy period of contemplation, where bulls and bears stare at one another across the aisle, as if a stalemate is acceptable. It is not. There will be a break out, but as long as Bitcoin keeps “tree hugging” at $10,000, the longer the odds favor a major move downwards. Analysts are searching in desperation for insights, if not in the historical record, then in the impending event calendar.

Let’s speak to the “downers” first. Everyone keeps harping upon the $8,500 “gap” in CME Bitcoin futures that remain to be filled. This theory seems to be one of those, which if repeated enough, suddenly becomes truth and reality, regardless of the fact that the CME will have “natural” gaps, since it is not open over the weekend. Analysts in the negative camp also note that Bitcoin has gone to $10,000 “well” too many times. Its support is “wearing thin”, in their estimation.

Per DonAlt, a popular crypto analyst on Twitter: “$BTC daily update: Closed above mini resistance and immediately dumped off. That’s what I mean when I say choppy conditions. That said it never left the lower trading range, and as long it’s in there short-term bias has to be bearish. Support wearing thin here, in my opinion.”

Is there a positive counter argument? Hans Hauge, senior qualitative researcher at crypto investment fund Ikigai, sees several signs that could lead to a major upward break out. His favorite is to note that:

[The Bitcoin] Crypto Fear and Greed [Index] is printing all time lows. That’s the exact thing you should be looking for, if you’re buying the dip for the long-term.

In times like these, patience is rewarded by waiting for a predominant trend to overtake the market. Once confirmed, ride it for all that it is worth.

Read Also: