From Crash to Necessary Fill Levels:
We have seen a recent selloff in the entire CryptoCurrency asset class over the past week. A lot has happened that is newsworthy which has caused some dips. From China announcing they plan on banning bitcoin exchanges to JPM CEO Jamie Dimon saying bitcoin is a fraud.
To see how broad-based this trend has been, let’s look at Bitcoin BTC/USD or follow on our bitcoin chart page.
A fairly straightforward test of the $3,800 support level is occurring right now. We busted through the $4000 support level established at the end of August, and if we breach $3800, things could get even more ugly as we could see more downtrending and a gap fill from $3200 to $3500.
As we have seen in the past, once that gap fill occurs, we will see an instant test again of the $3800 and $4000 levels.
It is important to note that corrections like this are healthy for the market and necessary. This allows for the continuation of the general uptrend pattern we have seen in the crypto market.
What will be nice is once this correct occurs, we will have EXTREMELY strong support levels at the $3500-$3800 level and that will be our new bottom moving forward as we trend back to $5000 by year’s end.
Check back with us later this week for more analysis on various Cryptocurrencies…
In coin we trust,