Bitcoin
Why Analysts are Bullish on Bitcoin Despite Close Beneath Key $11,700 Level
Cole Petersen | Aug 03, 2020 | 18:00
- Bitcoin has been flashing some mixed signs to investors as of late
- Despite seeing intense bullishness throughout the past week as it rallied from the lower-$10,000 region to highs of $12,000, analysts still remain cautious regarding where it may trend next
- Their present lack of bullishness is rooted in the cryptocurrency’s inability to close its weekly candle above $11,700
- This is a historically important level that analysts were closely watching over the past couple of days
- That being said, it has still maintained above its crucial macro support of $10,600 – leading one top trader to remain optimistic
Bitcoin and the aggregated cryptocurrency market are currently in a relatively good position despite the strong selloff seen just two days ago.
BTC has now entered what could ultimately be a consolidation phase within the lower-$11,000 region.
Buyers have been able to lace this region with strong support, as even the heavy selling pressure that came about as a result of the $12,000 rejection wasn’t enough to send it below $11,000.
One analyst is now noting that he believes the crypto remains strong as long as it continues holding above the mid-$10,000 region.
Bitcoin Consolidates Within Lower-$11,000 Region Following Rejection at $12,000
At the time of writing, Bitcoin is trading up just over 1% at its current price of $11,225. This marks a slight climb from daily lows of $11,000 that were set yesterday as bears attempted to spark a short-term selloff.
The ardent defense of this support from bulls is a positive sign, as it shows that they still have the upper hand over bears.
One analyst explained that the rejection at $12,000 did strike a blow to the benchmark cryptocurrency’s technical structure, however, as it failed to close its weekly candle above the historically important $11,700 level.
The analyst offered the below chart showing the rejection that occurred just above this level.
Image Courtesy of Teddy. Chart via TradingView.
As seen above, previous rejections at this level – like those seen last summer – had grave implications for the cryptocurrency.
Why Analysts Remain Optimistic that Further Upside is Imminent
Despite the potential weakness caused by the break below $11,700, another analyst recently explained that high time frame closes above Bitcoin’s weekly support at $10,600 and monthly support between $10,000 and $10,700 place it in a strong position.
“Monthly & weekly closed above resistance. Weekly support $10600, monthly support $10700-$10000. As long as we don’t get HTF closes below looking for buys around those supports & targeting higher is sane.”
If $12,000 does end up marking a local high that is followed by a short-term downtrend, Bitcoin’s reaction to these levels will be imperative for understanding its mid-term outlook.
Featured image from Unsplash. Charts from TradingView.
