While the bitcoin (BTC) price is still fluctuating, on Friday, Jan 12, it touched $14k again, with a short phase of range bound trading expectations. There was a huge amount of bearish activity a day before, however that sell off in the cryptocurrency market said to be the world’s largest in terms of market capitalization, seems to have ceased at the time of writing this article.
The bitcoin had takers at $12,878.60, with an intra-day high of $13,773.34 as per the Bitcoin Price Index (BPI) from Coindesk. And then the price touched $14,090, up at a 9.4% as compared to $12,878, which was a 12 day low.
The upward price variation suggests that the cryptocurrency market may have taken reports and speculation of a possible South Korean ban, in its stride. Perhaps, it also indicates that the investors might have realized that a ban from South Korea, if at all, may not happen in the near future.
The speculation of a South Korean remain and bitcoin may not touch record highs any time soon, but the low may also be a short term one. However, a consolidation is seen in the near future as per the technical charts.
The Coinbase BTC chart has some pointers:
- In spite of a bearish activity, BTC seems to have defended the upward trend line between the lows of Nov 12 and Dec 22.
- The bears’ failure to go past the trendline support saw the bitcoin catch a bid wave on Jan 12.
- The moving average (MA) across 50 days is on the rise favoring the bulls.
- Between the 5 and 10 day moving average, there is a bearish crossover.
The Coinbase BTC chart here shows:
- The bearish sell off that happened seems to have run out of steam near the upward trend of the 10 week moving average.
- The Fibonacci retracement level of 38.2% at $12,573.88 in the last week of December acted strong. It also shows signs of an ebbing bearish activity closer to the Fibonacci level.
The upward bullish trend as well as the recurring bearish exhaustion close to the Fibonacci 38.2% of $12,573 suggests that further dips below $12000 may well be short term. However, the bearish moving average pattern also indicates that the
bears will continue to have their say in the market. Therefore, the bitcoin may see tough times ahead in terms of achieving any gains beyond $16,000.
In the next few days, consolidation in the range of $16,000 to $12,000 may increase the odds of a fresh bearish sell off activity. This could help the market to give up the bullish bias and improve the 50 day moving average. Hence, the bulls should make good on the upward trendline defense as seen within the past 24 hours.
Prediction for Bullish Market Activity: If the market closes above the 50 day moving average upward trend line, with a $17, 174 movement as of Monday, we can see rallies that lead to $20,000 highs.