Following the market’s recent volatility, Bitcoin has been able to climb back into the $3,600 range and has further confirmed $3,550 as a level of support. Bitcoin’s slight price rise today has allowed most altcoins to post gains, while some cryptocurrencies have surged over 4%.
Analysts have mixed opinions regarding the importance of the market’s holding their recently established support levels, as some see each bounce as a selling opportunity, while others believe that the markets could be nearing a good opportunity for traders to enter new long positions.
Bitcoin Climbs Slightly After Holding above Support Level
At the time of writing, Bitcoin is trading up nearly 1% at its current price of $3,600. This past weekend, BTC surged to highs of nearly $3,750 before retracing back down to its long-held support level at $3,550. This level once again held strong, but the ensuing bounce has been relatively weak.
Because Bitcoin has continued to range sideways and is showing few signs of growing fundamental strength, Jani Ziedins of the CrackedMarket blog recently told MarketWatch that he believes each price bounce is a good opportunity to sell before it drops lower.
“Bitcoin keeps bouncing along in the upper $3K range, but it was unable to extend last week’s breakout above this level… Demand remains an Achilles’ heel for all cryptocurrencies because most people have soured on this investment class and have no interest in putting in new money. Every bounce continues to be a selling opportunity,” Ziedins explained.
Alex Krüger, an economist who focuses on cryptocurrencies, shared a similar sentiment, noting that although Bitcoin rose sharply from a brief test of $3,450, the current movements are simply “crumbs for traders,” further adding that he doesn’t see any significant bullish trend emerging until late-February.
“$BTC failure test of the $3450 weekend low (i.e. push down swiftly rejected) tilted balance back to the long side in the short term. Nothing too exciting though… Short term crumbs for traders. Don't see any reason for a bullish trend to emerge until sometime after Feb/27,” he explained.
Altcoins Trade Up
The general cryptocurrency markets have risen slightly after Bitcoin reacted positively to its temporary dip below $3,500 that occurred earlier this morning.
This positive response to this support level has led Trading Room, a popular cryptocurrency analyst group on Twitter, to conclude that Bitcoin, Litecoin, and Ethereum, could all see a price surge if they can finish the day above key price levels.
"All key levels holding across $BTC $ETH $LTC… Price tried to break below key support but violently rejected so far. However will re-enter Longs only after we get a daily candle close above: 3675 #Bitcoin… 123.50 #Ethereum… 32.15 #Litecoin… Trend is your friend, allow it to develop,” they explained.
At the time of writing, Ethereum (ETH) is trading up 1.3% at its current price of $118.61.
Litecoin (LTC) is trading up just under 2% at its current price of $31.73.
XRP is trading down marginally today at its current price of $0.319.
Bitcoin Cash and EOS are some of today’s best performing cryptocurrencies, as they are trading up 4.5% and 4.3% respectively.