- Bitcoin rocketed to $11,400 yesterday following months of sideways action
- The widely predicted move comes after gold and silver both performed similarly
- What happens now is key, with bulls needing a weekly close around these levels
Bitcoin rocketed to $11,400 in a sensational burst yesterday that rolled back the years and took out one and almost two key resistance points. In a move reminiscent of 2017, Bitcoin ruined many a good alt setup by going on a rip of its own and closing the day at $11,004, the highest close in very nearly a year. The jump echoes similar moves made by gold and silver recently and reinforces Bitcoin’s position as an independent, government-agnostic store of value.
Bitcoin Busts Out of the Channel
Having been held in a tight range ever since the halving in May, the old adage of never shorting a dull market bore fruit again as Bitcoin surged first to $10,800 and then up to $11,400:
Encouragingly, unlike other sharp moves in recent months, Bitcoin remained in the $11,000 range after topping out, suggesting that it is more capable of holding its newly gained ground than previously. Perhaps even more critically, it also convincingly took out two and a half years’ worth of resistance:
This chart on its own could signal the start of the next market cycle, but Bitcoin’s performance over the next few days will be critical to judge its overall health following this move. A pullback of sorts is expected, but a sharp rejection back underneath the long term resistance would not be a positive move, and would suggest that this was nothing more than a bull trap and that further lows are expected.
Alts in Trouble?
The jump naturally received a rapturous welcome on Twitter, with bullish predictions and bottom buyers coming out in force:
Hope y’all bought some BTC back when I called the bottom in March! ETH has also been performing quite well, I like to spread my investment between them at a 3:1 ratio. https://t.co/U9DlCV1jsd
— WallStreetBets[god] (@WSBgod) July 28, 2020
#Bitcoin’s got a clear path to $28,000
For the 500th time in 10 yrs, @PeterSchiff is wrong *AGAIN* on BTC
His clients are suffering horrendous opportunity costs
I told him to buy at $1 $10 $100 $1000
Thousands told him to buy under $10,000
Worst money manager in history
— Max Keiser 🍊💊🎤 (@maxkeiser) July 27, 2020
It’ll easily break $20,000 once they come to play.
— David Gokhshtein (@davidgokhshtein) July 28, 2020
Only those who were in heavy alt positions or were shorting Bitcoin at the time of its jump would have been negatively impacted by its swift rise, and indeed the alt market is where it could be worth focusing now. The Bitcoin dominance chart shows a swift rebound by Bitcoin since the weekend following a prolonged downtrend:
Whether this will turn out to be the start of a longer term revival only time will tell, but it is certainly worth being careful with any alt positions you take out in the next few days.