Bitcoin breaks higher

Gregory McKenna GO Markets

Bitcoin is nothing if not a fantastic real-time test of some well-respected trading axioms around trendlines and Fibonacci support and resistance.

And it is this prism through which I view Bitcoin and on which basis I often say it charts very well.

And if asset charts very well then there is every likelihood the corollary will be that it trades equally well.

So it is today that when looking at the BTCUSD chart it's clear that after finding support exactly where it should have back in early February at a cluster of Fibonacci support and the 200-day moving average Bitcoin has since rallied, broken two trendlines and is now approach a significant cluster of Fibonacci resistance.

As you can see in the chart below this $10,600 to $11,200 holds three different Fibonacci levels including from the rally which began in mid-2017 to the record high, the rally from November to that record high, and more recently the fall from the record high to February's lows.

At $11,081 this morning BTC has already bested the lower level, broken the trendline from the high and is now approaching the 38.2% - garden variety - retracement level of the fall to February's lows. This zone also contains the 50% retracement level of November's rally which spiked to the record high.

So, a break of $11,200 could open up $1500 of clean air, with some resistance on the way to $12.700 around $11,700. It has to break topside first though and support is at $10,000/10,400.

Author

Gregory McKenna

GO Markets

Greg McKenna has been working in and around financial markets since 1988.

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