Bitcoin Hesitates Around $11k

Bitcoin continues to defy gravity after piercing $11k on Friday. Yet with prices looking stretched, we suspect a retracement could be due before its trend continues.

Bitcoin continues to defy gravity after piercing $11k on Friday. Yet with prices looking stretched, we suspect a retracement could be due before its trend continues.

That said, Bitcoin has shown its ability to not look back once a move is underway so we cannot rule out an attempt from bulls to push it to new highs. But we’d suggest caution at these high levels, given the lack of pullbacks since the June low.

We can see on the relative performance charts that crypto currencies are highly correlated. Year to date, Bitcoin has rallied over 180%, most of which has occurred these past three months. Yet even these eye watering numbers pale in comparison to Litecoin which has rallied a staggering 356% over the same period.

Still, there are signs that the move could be in need of a pause.

  • Friday failed to close above $11k
  • A bearish hammer has formed beyond the upper Keltner band to warn of price exhaustion
  • A bearish divergence is forming on the RSI

Please note this product may not be available to trade in all regions.

From here’s we’d like to see prices stabilise and retrace towards the May high before considering long positions on the daily chart. If a deeper correction is to occur, look for prices to hold above the support zone around 9,100. Although the trend remains bullish above the 7,436.40 low.

Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.

Open an Account