The Bitcoin had a strong rally recently due to the bitcoin halving event. The price went past $9,000 to reach as high as $10,045. It formed a double top at around $10,000 and showed signs of losing momentum, as indicated by the first arrow in the momentum chart. The price dipped to $9,464 and made a lower high at $9,787 before breaking the previously low and dipped further to $8,101.
Based on the most recent trading activities, a lot of people had taken profit between $9,700 and $10,000. When the traders saw a lower high at $9,787, they started establishing short positions in anticipation of a drop. If there is no positive news coming ahead, the BTC price may fall back to $7,760 where there was a breakout in end of April. Consider waiting for a sideway channel to form and then determine the direction of the trade once a breakout happens.
Review of the week:
Lennard Neo, head of research at Stack AM Pte., which provides cryptocurrency trackers and index funds, shared his view before the cryptocurrency’s upcoming halving, when the rewards miners receive for processing transactions will be cut in half as soon as next week, an intentional feature of Bitcoin designed to control inflation: “With the Bitcoin halving fast approaching, we believe a short-term pullback is highly likely immediately post-halving, as traders begin taking profits. In the longer-term, we can expect Bitcoin to register significant price appreciation toward the end of 2020 and early 2021.”
Paul Tudor Jones, the founder and chief investment officer of Tudor Investment Corp, one of Wall Street’s most-successful and seasoned hedge fund managers, says he sees the crypto asset as a hedge against upcoming inflation as central banks around the globe print money to relieve coronavirus-battered economies. Bloomberg News reported that Jones revealed in a message that one of his funds holds a low single-digit percentage in futures on the cryptocurrency and compared it to the gold trade back in the 1970s.
Disclaimer: The above market commentary is based on technical analysis using historical pricing data, and is for reference only. It does not serve as investment or trading advice.
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