Bitcoin was able to rally and take back a key support level yesterday after the U.S. dollar hit strong resistance. Price is lower by $70 today but there is still a chance to move higher from here. BTCUSD has been consolidating from the lows in early-September and is now trying to push higher.
News in Bitcoin was the largest-ever “wrapped Bitcoin” (WBTC) minted by Three Arrows Capital. The Singapore-based firm broke a record from only last week with the issuance. WBTC is one of the latest cryptocurrency buzz themes, with synthetic BTC tokens being issued 1:1 on the Ethereum blockchain. The goal of the coins is to increase liquidity on decentralized exchanges and other financial apps.
Bitcoin options had a record open interest this week- a term which relates to open contracts for long and short BTC bets. Those bets with a target price were due to expire this week and should see a trend develop afterwards. If short sellers made profits on the recent dip then they will possibly look to exit, which would push the price higher and that may explain some of yesterday’s spike higher in BTC.
For the near-term Bitcoin will follow the U.S. dollar which is sure to be volatile around key resistance, with a hostile U.S. election battle on the horizon. Bitcoin and after commodities have dipped recently on a lack of further stimulus from central banks, but with rising virus cases, that dynamic may change soon.
BTCUSD Technical Outlook
BTCUSD has rallied from the $10,200 level to take the support at $10,400 which was a key high level in February and June. The move by BTC gives the coin a chance to push higher to the $11,000 price and the 50-day moving average sits just above that resistance. Getting through those prices would still see the downtrend line from the August high so BTC has some work to do to pass the key $12k resistance. The Investing Cube team is currently available to assist all levels of traders with a Forex Trading Course or one-to-one coaching.