The picture for BTC and the alts is looking good. As traders come back from their summer holidays, it looks like the bull is also back in town and growing stronger with each passing day.
On a technical level, it’s been a great couple of weeks for BTC, as traders have pushed up through multiple layers of resistance. Regular pull-backs have ensured the market doesn’t get ahead of itself too fast, making this a strong and sustainable rally. The most immediate support levels at $6,800 and $7,000 held on tests. At the time of writing, BTC is bumping against the ceiling of downward-sloping support, with the next target to break around the $7,500 zone.
On the daily chart, we’re sat between the 50 and 200 moving averages, and RSI is heading north — though not yet into overbought territory. A look at the daily RSI over the last several months shows that it has been an excellent indicator for buying and (particularly) selling. We would advise caution, though: in the last bull market, there were periods when the daily RSI spent significant periods of time over 70, and selling there would have meant missing out. When BTC goes into bull mode it’s a raging bull, and the rules change.
The technical picture is broadly positive for now, then, though breaking $7,500 and then $8,000 would consolidate that impression. Pushing above the 200 MA would give traders a confidence boost, and likely when $10k is breached there will be another wave of media interest and speculation (of both kinds).
Right now, volumes are still lower than they were earlier in the year or at the end of 2017. Nevertheless, the mood has changed over the last month. More longs are opening on the futures markets, with CME reporting both a reduction in shorts and an increase in longs. On top of that, another 100 million USDT have recently been printed, suggesting incoming demand. Big money (which usually equals smart money) is signposting its expectations.
On the other side of the coin, one other factor that has attracted interest in recent days is the movement of large quantities of bitcoins from a wallet that has been dormant since 2014. Around $100 million has apparently been moved to Bitfinex and Binance, presumably to sell for USD and altcoins, respectively. We’ll take a closer look at this tomorrow, but that could indicate considerable sell pressure in the short term. Right now, though, the market doesn’t seem to care.
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