Bitcoin’s Attack on Fortress Resistance
• Bitcoin is attempting to break through its most important resistance at $25,300 and decisively announce the long awaited bull market.
• Chinese central bank injected CNY 500 billion of quantitative easing into its markets, resulting in a positive boost for bitcoin and the rest of the crypto market.
• With stock market entering recession, investors are looking for value elsewhere and could deploy a heap of money if bitcoin breaks $25,000.
The Siege is Initiated
Last Thursday saw the start of the siege that bitcoin is now initiating against the $25,300 last big resistance. Friday and Saturday also saw bitcoin approaches, but then on Sunday it knocked on that door once again with another touch point. Monday has dawned, and bitcoin is once again approaching the all-important level with a battering ram. In technical analysis, the more times a level is attacked, the weaker it becomes before finally being breached. Of course, it could well be that the attacks become weaker and bitcoin is eventually rejected, falling back down to regain itself at perhaps much lower levels.
$25,000 Break Imminent?
It does look like there will be an extremely serious attempt by the bitcoin bulls to pierce this level and take hold above it. With a good few daily candles above this level, bitcoin would be likely to rapidly climb to $28,000 or higher due to almost no further resistance. Each time bitcoin rises to attack this level and gets rejected it drops down to a support level of $24,000 which now has five touch points including today’s. Another even higher level which is taking form as resistance/support is at $24,850.
China Adds Impetus
So what has given crypto markets this new impetus? China could be one of them as their central bank injected CNY 500 billion of quantitative easing into their markets just recently in order to boost liquidity – resulting in many Chinese-based cryptocurrencies running higher as well as providing a positive boost for bitcoin and other cryptos too.
Dry Powder Waiting On The Sidelines
With stock markets entering recession either this year or next year there won’t be much upside potential for investors here so they are looking elsewhere for value – where better than an emerging new asset class such as crypto with possibly already having seen its bottom? If bitcoins does break through its fortress resistance at $25K then a heap of money sitting on sidelines ready for such an occurrence may just get deployed!