Bitcoin attacks huge resistance

Bitcoin is facing fortress resistance made up of the 200 weekly MA and the last high reached in August 2022.

Will this week be the showdown, as bitcoin attempts to break through its most important resistance and decisively announce that the long awaited bull market is well and truly here?

The siege is initiated

Last Thursday saw the start of the siege that bitcoin is now initiating against the $25,300 last big resistance. That was the first knock on the door. Friday and Saturday also saw bitcoin approaches, but then on Sunday it knocked on that door once again with another touch point.

Monday has dawned, and bitcoin is once again approaching the all-important level with a battering ram. In technical analysis, the more times a level is attacked, the weaker it becomes before finally being breached.

Of course, it could well be that the attacks become weaker and bitcoin is eventually rejected, falling back down to regain itself at perhaps much lower levels.

$25,000 break imminent?

However, it does look like this is going to be an extremely serious attempt by the bitcoin bulls to pierce the level and take hold above. With a good few daily candles above the level, bitcoin would be likely to rapidly climb to $28,000 and above due to almost no further resistance.

Each time bitcoin rises to attack the level and is rejected, it is now dropping down to a support level of $24,000 which now has five touch points including today’s. Another even higher level which is taking form as resistance/support is at $24,850.

China adds to the impetus

So what has given the crypto market this new impetus? China could be the number one player in this respect. The Chinese central bank injected CNY 500 billion of quantitative easing into its markets just recently in order to boost liquidity.

For this reason many of the Chinese-based cryptocurrencies have been running, and there has been a positive boost for bitcoin and the rest of the crypto market.

Dry powder waiting on the sidelines

With the stock market entering recession either this or next year there is not going to be too much in respect to upside for investors in this area. Therefore they will look elsewhere for value. Where better than an emerging new asset class that has possibly already seen a bottom.

If bitcoin does break through $25,000 this week or at least in the near future perhaps a heap of money sitting on the sidelines, ready for such an occurrence, could be deployed.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.