Cointree Crypto Market Update - August 12th 2020

Market update for traders

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In the week that was, bitcoin attempted one last push at $17,000 AUD, but it proved a bridge too far, dropping over 6% in the last 48 hours to sit at $15,966 at the time of writing.

The channel we have been following since July finally broke to the downside and price action pierced the 50EMA on the 4hr. Bitcoin’s heavy correlation to gold seems to have had a major effect here, as gold fell over 8% overnight on news that Russia has trialled a vaccine for COVID-19 and bitcoin fell in similar manner, but overall is holding up better.

Bitcoin is known for its pullbacks in an uptrending market, and on higher time frames, this price action is printing another higher-low. In the grand scheme, this is likely just another dip before the next leg up until confirmation otherwise. For now, previously strong resistance at $16,000 (purple line) is acting as support on the downside, if it fails, bears may look to move price down to the 200 EMA in the low $14,000’s. So far though, buyers have stepped in here and Bulls will look to reclaim the channel indicated in the charts and push again for $17,000 otherwise we can expect sideways chop into next week.

In another big week, some major Alt-coins made major moves...Chainlink, again, was the big gainer, up 38%, while tezos was up 23%, and iota up 19%.

Market update for beginners

In the week that was, bitcoin attempted one last push at $17,000 AUD, but it proved a bridge too far, dropping over 6% in the last 48 hours to sit at $15,966 at the time of writing.

The channel we have been following since July finally broke down and we now watch the $16,000 level with keen interest. Bitcoin’s correlation to Gold seems to have had a major effect overnight, as Gold fell over 8% on news that Russia has trialled a vaccine for COVID-19.

Gold has long been the asset of last resort in times of economic turmoil, and since Covid, it has been firing on all cylinders. Bitcoin is often thought of as Gold 2.0 and has mirrored the price movements of Gold during this period.

Key Takeaway: Bitcoin is known for its pullbacks in times of longer-term positivity where buyers are in control and sell-offs are short lived. On higher time frames, this price action looks to be healthy after so many weeks of UP UP UP. So far, buyers have stepped in and will look to reclaim the channel indicated in the charts and push again for $17,000, otherwise, we can expect sideways chop into next week. If $16,000 fails, we could see Bitcoin fall into the low $14,000 where key moving averages reside.

In another big week, some major Alt-coins made major moves...Chainlink, again, was the big gainer, up 38%, while tezos was up 23%, and iota up 19%.