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Cryptocurrency News Articles
Bitcoin (BTC) Remains Stuck in a Range as Investors Sideline Themselves Ahead of the November Elections
Sep 21, 2024 at 12:09 am
ear to be second-guessing their buying spree after the Fed's interest rate cut earlier this week. All the major stock indexes are trading lower on Friday with the tech heavy Nasdaq 100 leading the way with losses of more than -1.5% at the mid-day trading mark. There's an exception though. Gold and Bitcoin (BTC) are holding their gains for the week, suggesting that investors are still looking for a potential hedge ahead of the November elections. I've been a bull on Gold for all of 2024, just writing last week about how Gold was no longer a hedge, it's turned into a trade. But Bitcoin has been relatively quiet for some time as the speculative/hedge has been trading in a range. It's time to check out the charts for a quick read on where Bitcoin is heading. The Situation Put simply, the news cycle has been slow for the major cryptocurrencies. Check the cryptocurrency headlines for the last two weeks and they're all about one thing, the launch of Trump's new cryptocurrency business. I literally gave a little smile when I saw the headline that Donald Trump was handing out “crypto burgers” that he bought with Bitcoin on Thursday to celebrate National Burger Day. I honestly stick to the headliner cryptocurrencies – Bitcoin and Ethereum – so I can't answer the question whether you should buy Trump's new coin, but Ian King has an opinion worth checking out if you've been considering Trump's crypto venture. Outside of that though, the Bitcoin and other cryptocurrencies have been relatively quiet over the last three months. That signals something to me. Investors have grown tired of Crypto for the moment. For the year, Bitcoin is trading with gains near 50% versus Ethereum's gains of only 11%. The gains that have been generated for the year came on the back of heavy headline cycles as both popular cryptocurrencies were going through the SEC's approval process to be traded in Exchange Traded Funds. In addition, investors heard more about Bitcoin through the first half of the year as the “halving” approached. It's been a clear “buy the rumor / sell the news” year for cryptocurrencies. And from the look of the charts, that may not change until after the election. More than anything, Bitcoin has remained a great “risk-on / risk-off” indicator. Let's Look at the Charts for Bitcoin Having traded in a range for the last three months, Bitcoin finds itself in an intermediate-term bear market trend. That trend is indicated by the 50-day for Bitcoin falling into a declining trend in early July. Since then, $BTC has traded around the $60,000 price level, unable to break higher or lower than $55,000 and $65,000. Post-Fed buying sent Bitcoin to its 200-day moving average, which has been acting as heavy resistance and is preparing to turn into a bearish pattern itself. That shift in the 200-day would turn overhead resistance into a heavy obstacle for investors. Ethereum found itself in an almost identical pattern in early July ahead of a 35% drop to its current price just above $2,500. Today, Ethereum faces resistance from its 50-day moving average that is in a precipitous decline. From a short-term perspective, Bitcoin is in a make-or-break battle with its 200-day moving average. Failure to move above this trendline should shift the price to the bottom of its range and possibly a $50,000 price before the elections on November 5. What Happens from Here Expect that we're going to continue to see Bitcoin's range extend itself through early November. There's one rule here that is going to help Bitcoin, as well as the rest of the market… “Investors Love Certainty.” It's true, uncertainty over anything will sideline investors in almost all security classes. The uncertainty that the markets are facing ahead of November's elections is likely to cause investors to begin increasing their holdings in cash. One exception to this is gold. Demand for gold is likely to continue its fiery pace right into the elections as a “safe haven” trade. A break below $55,000 on Bitcoin's daily chart will add significant selling pressure, but keep in mind that the long-term trend for the cryptocurrency remains bullish. This means that any dip below $55,000 is likely to be seen as a buying opportunity 6-12 months from now. How to Trade it As with everything else, I choose to keep it simple. The ARK 21Shares Bitcoin ETF (ARKB) is Kathie Wood's Ark Funds SEC approved Bitcoin ETF. The ETF value correlates highly
Major stock indexes opened the final trading day of the week in the red on Friday as investors appeared to be cashing out following a strong rally earlier this week.
However, both gold and Bitcoin (BTC) held onto their gains for the week, suggesting that investors were still looking for a potential hedge ahead of the November elections.
I’ve been a bull on Gold for all of 2024, just writing last week about how Gold was no longer a hedge, it’s turned into a trade.
But Bitcoin has been relatively quiet for some time as the speculative/hedge has been trading in a range.
It’s time to check out the charts for a quick read on where Bitcoin is headed.
Investors have grown tired of crypto for the moment.
For the year, Bitcoin is trading with gains near 50% versus Ethereum’s gains of only 11%.
The gains that have been generated for the year came on the back of heavy headline cycles as both popular cryptocurrencies were going through the SEC’s approval process to be traded in Exchange Traded Funds.
In addition, investors heard more about Bitcoin through the first half of the year as the “halving” approached.
It’s been a clear “buy the rumor / sell the news” year for cryptocurrencies.
And from the look of the charts, that may not change until after the election.
More than anything, Bitcoin has remained a great “risk-on / risk-off” indicator.
Having traded in a range for the last three months, Bitcoin finds itself in an intermediate-term bear market trend.
That trend is indicated by the 50-day for Bitcoin falling into a declining trend in early July.
Since then, $BTC has traded around the $60,000 price level, unable to break higher or lower than $55,000 and $65,000.
Post-Fed buying sent Bitcoin to its 200-day moving average, which has been acting as heavy resistance and is preparing to turn into a bearish pattern itself.
That shift in the 200-day would turn overhead resistance into a heavy obstacle for investors.
Ethereum found itself in an almost identical pattern in early July ahead of a 35% drop to its current price just above $2,500.
Today, Ethereum faces resistance from its 50-day moving average that is in a precipitous decline.
From a short-term perspective, Bitcoin is in a make-or-break battle with its 200-day moving average.
Failure to move above this trendline should shift the price to the bottom of its range and possibly a $50,000 price before the elections on November 5.
Expect that we’re going to continue to see Bitcoin’s range extend itself through early November.
There’s one rule here that is going to help Bitcoin, as well as the rest of the market…
“Investors Love Certainty.”
It’s true, uncertainty over anything will sideline investors in almost all security classes.
The uncertainty that the markets are facing ahead of November’s elections is likely to cause investors to begin increasing their holdings in cash.
One exception to this is gold.
Demand for gold is likely to continue its fiery pace right into the elections as a “safe haven” trade.
A break below $55,000 on Bitcoin’s daily chart will add significant selling pressure, but keep in mind that the long-term trend for the cryptocurrency remains bullish.
This means that any dip below $55,000 is likely to be seen as a buying opportunity 6-12 months from now.
As with everything else, I choose to keep it simple.
The ARK 21Shares Bitcoin ETF (ARKB) is Kathie Wood’s Ark Funds SEC approved Bitcoin ETF.
The ETF value correlates highly to the spot Bitcoin movement and management fees are among the lowest for approved spot Bitcoin traded ETFs.
Disclaimer:info@kdj.com
The information provided is not trading advice. kdj.com does not assume any responsibility for any investments made based on the information provided in this article. Cryptocurrencies are highly volatile and it is highly recommended that you invest with caution after thorough research!
If you believe that the content used on this website infringes your copyright, please contact us immediately (info@kdj.com) and we will delete it promptly.
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