After around 5 days of bullish moves that boosted bitcoin price by almost $4000, the market has cooled off somewhat after being rejected by $24,000.
The technology for bitcoin
After Bitcoin pierced the 200 weekly moving average, its task now is to close the next weekly candle above it. There was not enough buying power in the market to break the $24,000 resistance and bitcoin duly rolled over, consolidating around $23,300 on Monday at the time of writing.
The next strong support area is $22,500. This is below the 200 weekly moving average, but it could be feasible for bitcoin to return to support, reset the longer term RSIs and then retry the $24,000 resistance.
There is no Federal Reserve FOMC meeting in August, so perhaps the coast is clear for Bitcoin to rise as there will be no more possible rate hikes until September. Even after the last FOMC meeting, Fed Chairman Powell was far more dovish about the prospect of easing rate hikes, provided inflation numbers allow, of course.
Looking up the chart, $29,000 is the absolutely massive resistance to clear. Since December 2020, when Bitcoin first surpassed this price level, it has come back to retest multiple times and then finally failed in June of this year.
Technically speaking, it wouldn’t be such a good idea for the king of cryptocurrencies to break this resistance in the next few months or so as Bitcoin has to form a decent market structure first.
Therefore, it is more likely that Bitcoin would be rejected if it hit the $29,000 resistance and potentially bounce back and test $20,000.
Bitcoin the best game when fiat dies
Long-term bitcoin still looks like an extremely promising play and is arguably the best asset to hold over the next few years as fiat currencies accelerate their death spiral.
It looks likely that central banks will make their final toss in the form of CBDCs (central bank digital currencies), but unlike China, the great powers do not appear to be able to launch their CBDCs within the next few years, and fiat currency and the global monetary system may have reached a breaking point by then.
Gold and silver also appear to be good assets to invest one’s wealth in, but given the ease with which banks can simply print money out of thin air and then dump it into the paper futures markets, depressing the price (which has been going on for many years) is something to think about.
Bitcoin is also suffering from price suppression. Gensler, chairman of the SEC, made the decision to a Bitcoin Futures ETF instead of a spot ETF and therefore ensured that the price could only be cut.
However, the king is undressed and it can surely only be a matter of time before something in the monetary system breaks and it is revealed for what it is. When this system collapses, the savvy investor must invest in an asset that lies outside of it. Bitcoin is that asset.
Disclaimer: This article is for informational purposes only. It is not offered or intended to be relied upon as legal, tax, investment, financial or other advice.
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