Bitcoin up traders cautious

Markets Report: Bitcoin price hits $9,380 in fresh uptick as traders stay cautious on bull market

A sudden trip closer to $9,500 is not a definitive sign of a trend break, say analysts as Bitcoin’s compression looks ripe for disruption

Bitcoin surprised the market on July 21 as a sudden break to the upside saw the largest cryptocurrency accelerate towards $9,500.

Data from price trackers showed BTC/USD suddenly gaining about 1.5% on Tuesday, contrasting the calmer behavior which had characterized the past five days.

At press time, the pair traded at $9,380—up almost 2.5%—staying at the top of its trading channel as momentum built below $9,400.

Van de Poppe: BTC market is “showing strength”

The move appeared to have little precedent — in line with behavior seen over the past few months, Bitcoin is ranging within a corridor between $9,000 and $9,500. 

Tuesday’s move nonetheless disrupted the pattern of “compression” — a cycle of lower highs and higher lows — which BTC/USD had exhibited throughout the past week.

“We’ve got our breaker and bullish move here, as the market is showing strength,” Michaël van de Poppe, a popular trader based at the Amsterdam Stock Exchange, tweeted on Tuesday.

“I don’t think $BTC will accelerate, as it’s just still hopping around.”

$9,380 nonetheless came as stock markets rallied, extending a correlation which has also become a feature of Bitcoin price action since the crash in March this year.

As Modern Consensus reported, macro market moves continue to impact BTC price action, a trend which analysts do not see breaking until a definitive change in investor sentiment takes hold. 

“Bitcoin could correct through price very quickly,” veteran trader Tone Vays warned on Monday prior to the latest gains. He added that he was still anticipating a pullback, and that the time spent consolidating in recent months was still not enough to form the foundation of a new bullish trend.

Limited bullish potential?

While deciding on the best course of action for the short term, fellow trader filbfilb told Telegram channel subscribers that he had entered a long position on BTC.

Like Van de Poppe, however, his optimism was not limitless, conditioned by whether or not BTC/USD hit the point of control (POC)  — the price level for the time period with the highest trade volumes.

Both traders’ perspectives underscore the limited belief in Bitcoin’s upside potential under current conditions. Major resistance below $10,000 remains, while BTC/USD has yet to crack the next band of resistance at $10,500, causing five figures to be only a temporary price feature in 2020. 

Perhaps unsurprisingly, more attention was being paid to gold and altcoins amid a lack of volatility in Bitcoin. 

Gold is challenging nine-year highs, with analysts primed for further gains, while altcoins are showing strength attributed to activity around the DeFi phenomenon.

“Nominal gold prices have already posted fresh records in every other G-10 and major emerging market currency this year,” Citigroup analysts said in a note quoted by Bloomberg this week. 

They added that fresh highs for XAU/USD were “only a matter of time.”

Updated chart image at 9:00 a.m. on July 20

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Anthony Bevan is a journalist focusing on disruptive finance and cryptocurrency, along with the changing face of the market as Bitcoin gains mainstream adoption. Journalists covering cryptocurrency for Modern Consensus May hold positions in some of the currencies they write about.