The price of Bitcoin rose sharply yesterday. The catalyst for the move higher came on the executive order from Pres. Biden that ordered the exploration of a digital currency operated by the US central bank (CBDB), and he encouraged regulators to identify and mitigate risks that digital assets pose to the financial system and broader economy. Priorities include promoting financial stability, responsible innovation and maintaining the countries financial edge.
The actions - and more importantly, the non-confrontational wording - seemed to open the door for a greater acceptance of digital currencies. The price moved sharply higher closing above the 100 and 200 hour MAs in the process (see blue and green lines in the chart above).
What it did not do is reach it's 100 day MA at $42508 (see blue line on the daily chart below). That was the hope for trading today. However, it was not to be.
Instead, the price retraced all the gains and is back down about $2700 on the day and below the $40000 level. The price is currently at $39,261
Looking at the hourly chart at the top of the post, the price decline took the price back below the 200 hour moving average (green line currently at $40,282) and the 100 hour moving average at $39,467 (blue line in the chart above). With the price currently trading at $39,251, the bears are more in control below those moving average levels. There was one attempt during the North American session to push higher, but sellers leaned against the 200 hour moving average and pushed price back down.
What next?
The price action has a lot of ups and downs. You can see that on the daily and the hourly charts. That is just the nature of the beast.
Nevertheless, the MAs on the hourly chart will still be used to define the risk/bias. Below the 200 and 100 hour MAs is more bearish. That is the scenario now.
Move above those MA, and the bias is back in the favor of the buyers with focus returning toward the 100 day MA at $43,509.
Absent that, and the bears have the better hand with the next major support targets coming just above the $37000 level (from $37015 to $37169). Move below that area and the door opens for more selling.
