Bitcoin staged a dramatic reversal yesterday to halt its week-long downtrend, opening up another chance for it to tackle yearly and all-time highs. Whales spent Tuesday trying to shake out holders, dumping the price as low as $9,613 before a strong rebound saw it spring back to $11,450 before finally coming to a halt. The move has split opinion, with some firmly nailing their bull flags to the mast and others preaching caution that a drop to the mid-8000s is imminent in order to fill the final CME gap.
The Case for the Bulls
The bullish argument revolves around the breaking of the downtrend, which BTC achieved by breaking through the $11,200 channel. After spending the day in the $9,800-$10,000 range, the fakeout to the low $9,600s was followed by a $1,000 push within an hour which is very suggestive of a turnaround in fortunes, allowing bulls to reconsider once again the route to all-time highs. Given that BTC smoked all resistances on the way to $14,000, and there is still very little all the way up to $17,000, bulls clearly feel that yearly highs and perhaps all-time highs are back on the cards yet again.
Were you shaken out?
— CZ Binance (@cz_binance) July 3, 2019
— Satoshi Flipper (@SatoshiFlipper) July 3, 2019
The Case for the Bears
The bears point to two indicators that suggest we may not be out of the woods yet. Firstly, BTC only closed the day at $10,700, below the downside trendline, meaning that unless it closes the day above $11,200-$11,500 (depending on individual charts) there is still every chance it could fall back there within 24 hours and remain in the bearish channel for the short term. Bears also point to the fact that the CME gap at $8,500 is the last remaining gap to be filled, with the $8,500-$8,700 range acting as a kind of magnet for price, or at least an ideal place to put some bids.
Potential double top forming on BTC here with very weak volume on the push up. On higher timeframe this looks like a bearish retest of the Nov 2017 monthly wick which would indicate further downside. pic.twitter.com/1gtccmgxm8
— Stillman (@Stillman_Crypto) July 3, 2019
— Crypto₿irb (@crypto_birb) July 3, 2019
Fear and Greed Index Gives Room to Grow
The Crypto Fear and Greed Index has seen a sharp turnaround too, from 63 yesterday to 79 today, which is the same level we saw last month when BTC was at $9,000 on the run up to $14,000. This suggests we have a way to go yet before we see the kind of euphoria we saw a week ago, when the level hit 92 before its recent fall. All eyes will be on the daily close therefore to see whether we are still in the downtrend, or if BTC holders can start looking towards record levels.