BTC/USD Pulls Back to Support After Bitcoin OGs Awaken
Despite broader risk-on sentiment, BTC/USD took a breather this week as traders speculated about Satoshi Nakamoto moving coins and OGs calling out Craig Wright as being a "liar and a fraud".
Bulls might be tentative buyers on weakness after the bears successfully defended $10,000 for the second time this month. However, with price still trading above both the 50 and 200 day exponential moving averages, bulls may be tempted by optimal risk/reward entries at either of the two averages.
Momentum traders will note that the 14 day RSI is at critical support, needing to hold at or around the 50 level to maintain the momentum of the current uptrend. Bears will note an emerging divergence on the 14 day RSI and may be quick to short any significant moves below the bull market RSI support level at ~50.
Bears will also note a breakout below the 3 month bullish trendline, with many momentum traders potentially shorting this move in anticipation of a trend reversal and a double top formation if BTC/USD trades below $8,000. Conversely, bulls will be looking for strong support at the $8,000 - $8,500 blue support zone, anticipating a higher low and a third (and final?) retest of the $10,000 resistance level.
Despite notable strength in global markets this week, the price of BTC/USD fell. Portfolio managers may see this is a further continuation of the decoupling of BTC/USD from broader risk-on sentiment and an overall positive for Bitcoin's value proposition as an uncorrelated source of alpha.
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