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The pair will likely continue rising as buyers attempt to retest this week’s high of 28,500.
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- Buy the BTC/USD pair and set a buy-stop at 28,500.
- Add a stop-loss at 27,000.
- Timeline: 1 day.
- Set a sell-stop at 27,520 and a take-profit at 26,500.
- Add a stop-loss at 28,500.
The BTC/USD pair surged to a high of 28,617 on Monday, the highest level since August 17th. It then pulled back during the American session as stocks and bonds continued their relentless sell-off. Bitcoin retreated to a low of 27,697.
Bitcoin and other cryptocurrencies started the quarter well as demand continued rising. At its peak, the coin was up by more than 14% from its lowest level this year. As a result, the total market cap of all cryptocurrencies soared to over $1.1 trillion.
They then pulled back as risks to the American and global economy continued. The 10-year and 30-year bond yields rose to the highest level in more than a decade. Bond yields and prices move in the opposite direction.
US equities also resumed the bearish trend. The Dow Jones dropped by more than 230 points while the S&P 500 and the Nasdaq 100 indices slipped by 25 and 25 points, respectively. The US dollar index (DXY), on the other hand, soared by more than 76 basis points to $106.62.
Bitcoin has done well in the past few weeks as investors predict that the Securities and Exchange Commission (SEC) will approve the spot Bitcoin ETF. Several companies like Blackrock, Fidelity, and Franklin Templeton have filed for spot Bitcoin ETFs with the SEC.
The odds are in their favor, especially after the agency lost a major lawsuit against Grayscale, which runs the biggest trust in the industry. A Bitcoin ETF will likely lead to more Bitcoin inflows, pushing the price higher.
The BTC/USD pair has done relatively well after bottoming below 25,000 in September. It jumped to a high of 28,593 on Monday and then resumed the bearish trend. Bitcoin has formed an inverted head and shoulders pattern whose neckline was at 27,522 (September 19th September.
This week’s high of 28,593 was an important level since it was the lowest swing on August 1st. Further, the pair rose above the 25-period and 50-period moving averages. Most importantly, it has formed a break and retest pattern, which is a sign of a bullish continuation.
Therefore, the pair will likely continue rising as buyers attempt to retest this week’s high of 28,500. A drop below the key support at 27,500 will point to more downside.
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