Bitcoin has had an extraordinary pump, But with every pump comes either a correction or a dump.
Like analysed in my previous analysis of this Pump (
), Bitcoin is still not clear yet. Although Bitcoin is showing signs of a bull run because of this crazy pump and all the retail investors celebrating the end of the dreadful month of September it does not mean Bitcoin is out of the woods.
As mentioned in the previous report Bitcoin should have hit a key level of resistance at $49,000 USD and that would mark the end of the short term down trend as there would not have been a lower high. However Bitcoin has started moving slightly downwards and topped with a high of $47,800 USD. This still means Bitcoin is in a down trend and with lower highs, lower lows usually follow. Right now the key level to look at is the $46,800 USD mark as it has been a previous level of support when everyone was convinced “Bitcoin on the way to an all time high” (18th September).
Usually I am very on Bitcoin but we are seeing the buyers lose their buying force. Although we have seen some strong rejections at that golden level of support at $46,800 USD I personally don’t feel there is a strong enough narrative to really drive retail investors into Bitcoin and drive the price up further.
We have heard about news about the US government not banning crypto, El Salvador mining Bitcoin with volcanic energy, Economists calling Bitcoin “digital Gold”. There wasn’t a single reason for this enormous pump. October 1st is the end of the quarter meaning many quarterly contracts have expired causing this slight pump which got retail investors exciting due to all the campaigning going on calling for a bull run to $100,000 USD for Bitcoin or at least achieve a all time high. This means as that slight pump happened it caused investors to jump on because they didn’t want to be late to this parabolic bull run driving the price higher and higher. A lot of the traders shorting Bitcoin with leverage ended up being liquidated due to this Pump and all that did was further drive the price higher and higher. This however is not healthy for the market as there is no Narrative to really drive the market or keep retail investors in other than the “digital gold” and I personally do not think it is strong enough to drive prices to an all time high.
I am a trader who likes to trade narratives and personally right now there isn’t a strong enough narrative to hold or even bring Bitcoin all the way to the all time high. I am personally really on Bitcoin but i do think this pump is overhyped and will face a correction soon with the technical target being around about $44,000 USD. However if we do see and increase in buying and see a push from sellers we are looking to hit the $51,000 USD long term down trend resistance line.
I personally have purchased Bitcoin in the beginning of the Bull run and will be holding my positions and waiting to see how the price reacts with the opening of the Nasdaq and the NYSE as stock prices are tied into the performance of Bitcoin . I also will be looking for price action around the $46,800 USD and the $49,000 USD (if it reaches till there).
If price action does show substantial rejection of the $46,800 USD I will increase the size of my position.
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This is not financial advice