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Bitcoin Friday: Are we ready for 50 000 USD break?

As always, we will look today mostly at the price of Bitcoin from not only short term view of few hours range, but also from long term view on the monthly chart. These two views are, however, vastly different.

Looking at September

Looking at daily chart of Bitcoin, I feel that in the coming weeks we can expect a more significant drawdown. I personally believe that it would mostly be a sharp, fast downward correction. This would however also mean that the rebound back would be also very fast. This is due to the fact that from the viewpoints of the long term bull market predictions, which are also supported by Stock-to-Flow model, we do not have a lot of time for a long term correction. Thus, if the bull market should continue, we should be expecting more upward movements rather than downwards.

Yet, we have seen on many occasions that Bitcoin gives us a chance to buy after summer at lower prices through more significant and sharp dump. These are usually followed by extraordinary growth periods. This phenomenon was for example present in the year 2017, when BTC fell to 3 000 USD and we all know what happened afterwards (sharp rise to almost 20 000 dollars by December 2017).

The same was visible also last year, where we tested 10 000 USD in September for the last time and then we only grew up. I therefore believe that we can expect a sharp dump this month, that might be a last buying opportunity before we „go to the moon.“

Bitcoin monthly chart Bitcoin monthly chart, Source: Author´s analysis

Break of 50 000 USD incoming?

However, in the short term view (coming hours – maximum end of this week), we can be looking at the break of 50 000 USD. Most important thing for this was the yesterdays daily close, where we saw the wick touch the MA21 and MA77. This is really, really bullish. Are you asking why? Because this says that the bears had the will to push the price down, however, the MA showed strong support and in combination with significant buy orders, were able to keep the price above these levels.

Edited : Bitcoin is currently fighting to stay over 50 000 USD, which it broke only few moments ago.

Bitcoin hourly chart Bitcoin hourly chart, Source: Author´s Analysis

What should you take from this?

Well, even though the short term looks bullish since BTC is trying to stay above 50 000 USD again, you should still be careful and expect a fast sharp dump (not even a correction, just a movement that can occur in matter of hours) and then we would be ready for new ATH.

Jakub is a crypto trader and founder of Trader 2.0 project, which helps hundreds of traders from central Europe to understand cryptocurrency trading and its challenges. Jakub not o...

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