Since my last update, the bitcoin price has stagnated, halting the 70% decline which started in November 2021.
In my previous update on the S&P 500, I highlighted proven levels that have the potential to cause reversals in price action.
These levels hold true across all asset classes, which include stocks, commodities, currencies and now cryptocurrencies.
As the article explains, it is impossible to predict which of these levels will eventually cause the reversal. Instead, good investors let price dictate a change in direction and then act according to the rules laid out in their trading/investing plan.
Below I have bitcoin's monthly timeframe.
We are entering the fourth month, where the price has found support made up of two critical levels highlighted in my article on the S&P 500.
- The $2000 round number.
- The resistance-turned-support high of December 2017.
Look further, and you have the weekly 200 simple moving average still acting as an area of comfort.
(It is important to note that all these key levels act as zonal areas, not hard levels. The price will whipsaw above and below these levels before deciding on a direction.)
The weekly 200 simple moving average is a proven catalyst for bull runs in bitcoin, as I explain in my previous article. Combined with the $2000 round number and the high of 2017 acting as support, Bitcoin's price has the potential to start moving back to its current all-time high.
We are coming towards the final month of Q3 and the start of Q4.
Trends and bullish moves are commonplace at this time of year through to Christmas.
Will 2022 end strong? We can only let the price dictate and remain ready to act.
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