Bitcoin has enjoyed some compelling gains lately, rising in value as the global asset markets respond to concerns surrounding the coronavirus.
The digital currency’s strong, upward movement has stalled in the last few days, facing significant resistance, technical analysts claimed.
However, this relative malaise will probably pass soon enough, according to several market observers.
[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
The cryptocurrency has been trading between $9,000 and $9,200 since early yesterday morning, CoinDesk data shows.
This period of calm came after bitcoin experienced a notable rally earlier in the week, climbing after it fell to nearly $8,400, additional CoinDesk figures reveal.
The run up represented “a solid, measured move,” according to Tim Enneking, managing director of Digital Capital Management.
Kiana Danial, CEO of Invest Diva, provided a similar perspective, emphasizing that bitcoin “has been in an overall healthy rebound since March 1st.”
Going forward, the two analysts made bullish predictions about the cryptocurrency.
“We suspect it will break through to the upside within the next day or two,” said Enneking,
Danial also chimed in, stating that “while we could see the resistance slow down the speed of the bullish momentum, it’s unlikely that it will stop it at this point.”
Evan Kuo, CEO and cofounder of digital currency firm Ampleforth, seemed a bit less certain.
“Bitcoin was on a descending pattern for awhile, the question now is whether things are turning,” he noted.
“Markets are obviously shaken by the coronavirus, and bitcoin is an uncorrelated risk-asset, but a risk asset nonetheless,” said Kuo.
The digital currency could also face headwinds as a result of strong shorting activity, said Pankaj Balani, CEO and cofounder of Delta Exchange.
He described the range between $9,300 and $9,500 as a “strong resistance zone,” noting that “we had seen a lot of shorting activity at these levels on Delta Exchange and expect to see fresh shorts in this zone.”
Disclosure: I own some bitcoin, bitcoin cash, litecoin, ether and EOS.