- The BTC/USD has rallied a bit heading into the weekend, showing signs of life again.
- Ultimately, the market looks as if it is trying to get back to the $21,000 level but has a long way to go to change the overall trend.
- Because of this, I think we’ve got a situation where we could see a lot of back and forth, and therefore I think it’s going to continue to be a situation where we have chop more than anything else.
The $18,000 level underneath should be supported, and an area that I think you should be paying close attention to. If we break down below there, then it’s possible that we could send the market down to the $15,000 level, possibly even down to the $12,000 level. That would be the beginning of the rally that we started a couple of years ago, thereby doing a “complete round-trip.”
Choppy and Noisy Behavior Ahead
All things being equal, this is a market that I think will continue to show a lot of the choppy and noisy behavior, so therefore you will have to be cautious about your position sizing and of course whether you get involved. I think at this point, if you are a longer-term holder of Bitcoin, it’s possible that you could see an opportunity here and there to pick up a little bit, but I would not jump “all in”, because quite frankly Wednesday of next week will have the Federal Reserve coming out with its monetary policy decision, and perhaps more importantly, the policy statement. Ultimately, this is a market that continues to see a lot of back and forth and therefore I think we’ve got a situation where we could a lot of noise, but I also believe that it is probably only a matter of time before Jerome Powell must come in and step on the necks of those who think that the Federal Reserve is going to loosen its monetary policy.
In a twist of irony, for Bitcoin to truly take off, it needs to see the Federal Reserve help it. The Federal Reserve listening monetary policy is exactly what Bitcoin will need to go higher over the longer term and for a lasting rally. If we can break above the $25,000 level, it’s likely that the market will then have changed completely.
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