Bitcoin Daily Price Forecast (11/10/20) — Quick Pause or Signs of Reversal?
Bitcoin pulled back on Monday to start the week, initially dropping almost down to the $14,000 level before finding support, bouncing up to the $15,500 level. This is a somewhat bearish hammer, with resistance at $16,000 being apparent and a $1,500+ intraday drop pointing to increased volatility at this altitude.
(November 9, 2020 8:00 PM EST)
Outlook: Bitcoin struggled on Monday, finding itself on the defensive as it tried to hang onto last week’s gains and the $15,000 level. This comes in the wake of Pfizer announcing a supposedly 90% effective COVID vaccine which caused a blowoff spike in equities and a nearly 100 point drop in risk assets like gold, which probably had something to do with Bitcoin’s fall as well. Bitcoin is a little overextended to the upside, as it hasn’t really taken a break since late September, so I think it’s due for a pullback. However, that pullback is a buying opportunity and should be taken advantage of, as Bitcoin doesn’t have a ton of downside from here given, well, everything.
Support: Look for support between $13,000 — $14,000. Below that, added support around $12,000, $11,000 and ultimately $10,000. The lower Bitcoin goes, the higher the chance of a violent bounce. I don’t anticipate very deep retracements here; in fact I’ll be looking to DCA in any and all pullbacks.
Resistance: $16,000 is an obvious minor resistance level right here, but I think it’s less resistance and more of Bitcoin simply overextended. It’s healthy for a correction every now and again, and with Bitcoin printing higher highs and higher lows, this trend points to $20,000 sooner rather than later. Bitcoin will almost certainly face significant resistance at $20,000, and will likely pullback once it hits it once or even a couple times. However, once Bitcoin breaks above $20,000, look out above, as the floodgates will open and there will be a wave of retail investors rushing in, as well as institutional investors looking to get skin in the game, as Bitcoin will officially be in a defined bull market with tremendous upside. It’s also important to note that although many institutions and funds are interested in Bitcoin, they are currently in a research, regulatory, or compliance phase, and are waiting for more regulatory clarity or increased liquidity in the asset class before allocating a percentage of their firm’s capital to initial positions.
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