Binance has announced that it will be opening two new offices in Brazil, with the team behind the operation doubling in number.
After a brutal period of sideways markets, thanks in part to the uncertainty with Tether and Bitfinex, Bitcoin has finally tipped her hand in the direction she wants to take: down. Much like the rest of the world markets has everyone spooked, Bitcoin (and by extension, cryptocurrencies as a whole) are also at a crucial juncture in price. Although there are neatly packaged narratives that the sell-off was done in response to the news that Bitstamp has been sold, any news event may just have sparked the tinderbox that was ready to blow. Regardless, a direction was chosen, so we’ll outline an approach for the coming week of Bitcoin trading
Unsurprisingly, the price drop came off one of the smallest weekly candle’s Bitcoins had since June 2017. A Doji can mean two things: usually it means that the market is undecided and neither bulls nor bears have the upper-hand. However, taken in the context of where we are in price, a Doji a few hundred dollars above yearly support is more telling of bull weakness than market indecisiveness.
However, since we’re still within the almighty range of $6800 USD and $6100, we cannot ignore a good risk-reward setup of hunting for a long in these zones. Before we get there, based on a simple retest of the breakdown level, should price happen to enter into the $6330-$6350 USD zone, a short can be taken with a take profit at yearly support level around $6150 USD. Alternatively, an aggressive short at this level can also be chanced, although risk needs to be managed tightly.
Although I have reservations for taking a long, the fact is, we are at yearly support, so I believe that we may see a bounce from $6150 and $6120. This also lines up with trendline support. However, if we are to close a daily candle under $6100, that to me would signal more bearish continuation. If that’s the case, longs should be scaled out and shorts should be prepared if we break support at $6050 USD.
Moving to Ethereum, one can conclude that it has also broken down after a week of consolidation, much like Bitcoin. Taking an aggressive short at current prices (~$197 USD) and targeting the prior lows does present good risk/return. However, Ethereum could see a bounce off nearer lows around $188 USD, in which case, consider the possibility of covering shorts at this level and preparing to add shorts at $200 resistance.
Overall, my outlook for the wider cryptocurrency market is cautiously bearish. Most importantly, be ready for some volatility should $6000 USD support be breached—have alarms set and do not over-leverage any one position. This is a critical juncture, price-wise, for Bitcoin and cryptocurrency in general. It would be somewhat poetic that Bitcoin does trend-defining move on the eve of its 10th Whitepaper launch Birthday (Bitcoin and altcoins.