Bitcoin – BTCUSD Rejection at 7,000 Cancels Positive Momentum

Βitcoin after a strong start yesterday stalled just shy of the 50-day moving average at $7,705 and retreated back to $7,300 territory giving up almost $400. Bitcoin broke above the $7,500 resistance and managed also to break above the $7,600, but the pullback cancelled the intraday strong momentum. Today the crypto pair hovers below the $7,300.

Positive headlines that the US is preparing the ‘Crypto-Currency Act of 2020’ supports bitcoin and other major cryptocurrencies. The new law will define which Fed agencies will be in charge of regulating the cryptocurrency markets. The proposed legislation will also provide a specific classification of crypto assets as crypto-currencies, crypto-securities, and crypto-commodities.

Bitcoin today is 0.36% lower at $7,281.54, the market cap stands at 134.49 billion. The total cryptocurrencies market cap is 195.71 billion.

Read our Best Trading Ideas for 2020.

Bitcoin – BTCUSD Strong Support at $7,132

Bitcoin – BTCUSD failed yesterday to break above the strong resistance at 7,736 as the sellers stepped in at defended successfully the crucial resistance. The correction that followed pushed quickly the bitcoin price below the $7,500 support zone. As a result the positive momentum cancelled and the focus shifted to lower levels. Now the short term outlook is negative as the pair retreated back to where it started yesterday.

Initial support for bitcoin stands at $7,258 the daily low. If bitcoin breaks below that level the next significant support will be met at $7,132 the low from December 22nd. In case that bears breach that level the recent positive momentum will be cancelled and might open the way for a test of the $7,000  which offered massive bids for many days the last week.

On the upside, immediate resistance for bitcoin stands at $7,337.96 the daily top. If bitcoin breaks above that level the next target is the high from yesterday’s session at $7,705. Then the 50-day moving average will be the crucial next obstacle for bulls.

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