Bitcoin is set to end the week back above $7,000 – unless the bears come out in force during the US trading session. It has held a key support zone but is not out of the digital woods yet as multiple levels of resistance still remain.
Bitcoin Facing Resistance
BTC is set to end the week exactly where it started out on Monday. A plunge to $6,500 was quickly recovered mid-week as buy signals were triggered en masse sending the digital asset surging back above $7k.
Since then it has retreated somewhat but is still consolidating around $7,150 at the time of writing. The long term trend is still very much bearish but one key take is that bitcoin has held crucial support twice over the past month.
Now that the $6,500 support zone has been established and held, let’s talk about resistance.
Above current price levels lies a multitude of resistance zones to overcome before bitcoin can be considered bullish. Crypto analyst ‘fil₿fil₿’ has plotted them on a chart to illustrate the uphill battle that BTC still faces.
Nice $btc pump yesterday but PA is miles from out of the woods. Lets talk bull when these have been cleared:
– POC Resistane
– Diag Resistance
– Multi Week Resistance
– Monthly Open Resistance
– Weekly Open Resistance pic.twitter.com/7JgS3M9xw2— fil₿fil₿ (@filbfilb) December 19, 2019
The $7,500 zone is serving as solid resistance at the moment as that was only broken once late last month and trading above it did not last long. The analyst has remained bearish eyeing another retest below $7k.
“Looking for a retrace to 6800-900 to see if we can get enough of a bounce to start asking questions about the resistance.”
It was also observed that if bitcoin ends the year above $7k it would still have doubled in price since the end of 2018.
When Bullish?
Bitcoin’s overall outlook for 2020 is bullish and there are several factors that are adding to that sentiment.
The holding of long term support is one and the upcoming halving is another. There is a strong likelihood now that the bottom has been tested at $6.5k but another retest or two should confirm it.
Bitcoin halving FOMO should start to pick up in the new year but industry analysts have noted that major rallies have happened after the event in previous cycles.
Economic principles such as stock to flow, inflation, and bitcoin energy value will come into effect in 2020 as supply and demand become bigger factors in BTC prices.
Add to that the fundamental premise of another global financial crisis and the need for a hedge or safe haven store of value gets stronger.
Bitcoin will be bullish next year but it must overcome those resistance hurdles before an uptrend can be confirmed.
Has bitcoin bottomed yet or is there further to fall? Add your comments below.
Images via Shutterstock, Twitter: @filbfilb