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Bitcoin returns to support area of 10,600 – what’s next?

  • Analyst has set a target of $10,760 as a bullish indicator for Bitcoin.
  • Bitcoin and gold with factors conducive to a continuation of the bull market.

Bitcoin has managed to recover after the flash crash it experienced a few days ago. At that time, the cryptocurrency broke through the $11,000 resistance but was affected by negative performance in the traditional market. At the time of publication, Bitcoin is trading at $10,626 with a 2.97% gain in the last 24 hours. In the monthly and weekly charts, Bitcoin shows losses of 6.65% and 3.13% respectively.

Regarding the recent performance of Bitcoin’s price, analyst and trader Josh Rager explained on his Twitter account that Bitcoin remains correlated with the traditional market. Therefore, the Rager expects that Bitcoin will continue to “follow it closely”. During the last few months, the traditional market has been affected by the negative impact of the Covid-19 pandemic. Rager also pointed out that the elections in the United States will be a determining factor in the coming months for that market and for Bitcoin.

Rager set the $10,760 mark as an important target for the monthly close of Bitcoin. This support level, as the image below shows, has been present at two key moments for BTC. The first one before its rise to its all-time high and the second one before the crash of the market during the first months of 2018. At this crucial point, Rager reiterated, the performance of the dollar and the S&P 500 index will determine whether Bitcoin “will be okay” in the short term. Rager added:

For me, I am not pessimistic at all. Can Bitcoin continue to drop? Certainly. I think it can drop to around $9,600 to completely close that gap for Bitcoin Futures in the CME. But, if you look at the weekly candle, it looks good … If it’s the price closes above $10,760, that will be a very good thing. I think that will be important for the upward trend to continue.

Bitcoin BTC

Source: https://pbs.twimg.com/media/Eis1Tf4XgAA8_02?format=png&name=large

Bitcoin with bullish factors to outperform the traditional market

Trader Big Chonis agrees with Rager and predicts a stabilization in the market if Bitcoin manages to stay above $10,000 over the weekend. He also invited investors to follow the closing of the stock markets that could put pressure on Bitcoin’s price, according to its performance.

Another trader that has analyzed the effect of the traditional market in Bitcoin, Cold Blooded Shiller, indicated that the market is “very temperamental” because of the effect of the pandemic and the proximity of the U.S. elections. The trader expects the volatility in the market to persist and predicts a further decline as the elections approach and uncertainty over results increases. The trader stated:

I say this because many of you are in “moon or doom” mode, where you simply see two outcomes without appreciating the wider conditions that we currently sit in.

Senior commodity strategist at Bloomberg, Mike McGlone, supports a possible bull run for Bitcoin. According to McGlone, the cryptocurrency has already outperformed the S&P 500 index by 45%. He also notes that the U.S. Federal Reserve’s monetary policy will favor Bitcoin and gold. McGlone stated:

Gold & Bitcoin ended Sept. 21 about 25% & 45% higher in 2020 vs. an almost unchanged S&P 500, indicating a relative value tilt. The certainty of QE vs. fiscal-stimulus uncertainty and a wobbly stockmarket is a foundation for a performance-baton pass to the quasi-currencies.

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About Author

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Reynaldo Marquez has closely followed the growth of Bitcoin and blockchain technology since 2016. He has since worked as a columnist on crypto coins covering advances, falls and rises in the market, bifurcations and developments. He believes that crypto coins and blockchain technology will have a great positive impact on people's lives.

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