BTC in last few hours has fallen sharply on light volume. In January, Bitcoin went up and it was partly credited by pundits to the coronavirus and a demonstration that bitcoin has become digital gold. Based on the relatively low volume in recent hours, that argument remains a question mark. The drawdown will probably reverse near the established price channel.
<< This chart is a day old, but the pop over 10K in last few hours remains meaningless short of a real move over 10,190.>>
BTC chart is displaying a complex Head and Shoulders pattern that has yet to confirm by a violation of the neckline by -5%. If it does fall below that point, it may free fall even lower.
Position size review / reduction of both BTC, GBTC and alt coins prudent in light of current technical weakness
Bitcoin is executing an orderly uptrend. In the near term there are few red flags indicating a downtrend might emerge. Also, there is no evidence that a “moonshot” or parabolic spike is in the making anytime soon. That is good news. There are an increasing number of BTC bulls that are convinced that the next spike is imminent- at least according to a scan of YouTube click-bait.
The case for it not spiking and continuing to stair-step is that this is sustainable. The longer it is sustained, the better a launch pad it is for the next spike. In the last few weeks of the 2019 rally, BTC shot up 65% from $8k to over $13k. Not a parabolic spike, but a huge move. Problem was, it started from $8k and ran out of steam. If BTC had a 65% move from its current price ($9857 (02/10/20 UTC:1700)) it would reach $16k, which is a major resistance zone. Again, it would probably run out of steam and fall. Ideally it climbs past $13k before having a large gap- up. That would likely be sustainable rally to a new ATH.
I suspect BTC will again suffer a parabolic spike, probably in the next 12 months. It will happen probably like the last time- driven by FOMO once it rises significantly above its last ATH. Be aware- based on historical pattern its likely to hit a new ATH at least 20% above previous and then trend sideways / sightly lower for 3-9 weeks while it consolidates gains.
Bottom Line: Chainlink (LINK) is most bullish, relative to Fibonacci Retracement. The reason is that is has moved significantly above the 61.8% level. From the perspective of this indicator- there the Jul 19 high is the next major resistance level.
Bullishness in order: Chainlink, Bitcoin, Ethereum, EOS, Tron (TRX), LiteCoin (LTC), Ripple Labs XRP (not shown).
Bitcoin moving over its 50% level is a sign of strength. The remainder are struggling at the 38.2% level. Ranked EOS ahead of TRX simply because it hasn’t lost value since hitting the level. The fact is the last four are laggards in terms of Golden Ratio ( https://preview.tinyurl.com/7vkpugr ).
Sympathy for the laggards: Since crypto price is symbiotic, particularly relative to Bitcoin price, a solid argument can be made for shifting some towards the laggards since they do tend to price appreciate later in a bullish bitcoin cycle.
Greyscale Bitcoin Investment Trust (GBTC) is a U.S. exchange based trust that represents a fractional amount of Bitcoin. For details, see: https://grayscale.co/bitcoin-trust/
GBTC has many downsides to just outright owning Bitcoin, but it has convenience and also can be placed in retirement accounts. GBTC is a derivative investment- so charting it has risks not inherent to the underlying. Because GBTC trades at a premium (that shifts constantly) to the price of bitcoin, it is a great indicator of the opinions of stock market investors.
Range bound trading in BTC continues with a test in last 24 of support at previous resistance level.