Bitcoin – Retracement complete or brief pause?

Bitcoin seeing temporary resistance

Bitcoin is slightly lower on Thursday, having stalled in the middle of the week following strong rallies this month.

The 50 fib level – April highs to June lows – is putting up a bit of a fight as resistance, although I don’t think it will keep the crypto bulls at bay for much longer. This rally has some real momentum and I think we’re just seeing some brief profit taking.

We did see the momentum indicators ease around the 50 fib level on the 4-hour chart but this may just support the profit taking theory and lead to a brief pullback.

We’re not seeing it gather any momentum to the downside although, if it does edge lower, it could see support around $42,500, which is prior support and resistance and the 38.2 fib.

The double top of the 4-hour chart would support this also, with a break of the neckline around $44,640, giving a possible price projection around that 38.2 fib level.

A move through $47,000 will see attention shift to $50,000-51,000 region where past support and resistance combines with the 61.8 fib. The psychological factor could also come into play around these big levels.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.

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