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⁠Bitcoin “fills” the $ 11.6k futures gap, but are $ 10k more likely than $ 15k?


The Bitcoin (BTC) price has had a great week with a rise of $ 11,700. After two months of consolidation within a range, the price of Bitcoin finally broke the psychological barrier of $ 10,000 and is currently facing the final hurdle before the bull market can begin.

Very often, people become optimistic once they see green candles, with which extraordinary goals can be found on social media. Can a short-term cooling-off period be justified or more likely?

Cryptocurrency market daily snapshot 8/1/2020

Daily snapshot of the cryptocurrency market 1/8/2020. Source: Coin360

Bitcoin closes the one-year CME gap and faces significant resistance

As Bitcoin’s price broke the $ 10,000 barrier, the next significant resistance zone became the $ 11,500-11,800 area. Since BTC was in range for two months, the breakout ended up being a very volatile move as expected, rising by $ 1,500 after this breakout finally happened.

BTC / USD 1-day chart

1-day chart of the BTC / USD pair. Source: TradingView

Given that Bitcoin’s price rose so fast in such a short period of time, Bitcoin’s price is unlikely to break the resistance zone all at once.

The $ 11,500-11,800 resistance area is an old and substantial area on the charts. This level not only served as resistance during the summer of 2019, but also acted as resistance during the high season of December 2017.

Thus, this is essentially the last massive level of resistance. If the Bitcoin price breaks through this zone then there is a lot of open range above and a new bull market will be upon us.

BTC / USD 1-day chart

1-day chart of the BTC / USD pair. Source: TradingView

Interestingly, most CME Bitcoin futures gaps are filled. However, they don’t necessarily fill up right away as demonstrated today. The chart above, for example, shows a gap of $ 11,700 since August 2019 that has just been filled.

Whats Next? The chart shows a clear gap in the area of ​​$ 9,700-10,000, unfilled. The probability of this gap being filled begins to increase with the current upward momentum, making a pullback towards the $ 9,800 area more likely every day.

The $ 11,300-11,400 barrier is crucial in lower time frames

BTC / USD 1-hour chart

1-hour chart of the BTC / USD pair. Source: TradingView

The 1-hour chart shows a clear bullish trend and keeping the previous resistance zone at $ 11,400 is crucial for the bulls.

An example can be seen in the resistance zone above. Bitcoin price failed to break above the $ 11,200 level for a few days, but after three tests the breakthrough occurred. Immediately thereafter, the price confirmed the previous resistance zone as a support level and continued the recovery.

An identical approach is required for the $ 11,400 level. If that level is valid, a further continuation towards USD 12,000 is expected. If the level is lost, a further correction to $ 10,800 or less is very possible.

Full capitalization of the cryptocurrency market is also facing resistance

Total market capitalization cryptocurrency 1-day chart

1-day chart of the total capitalization of the cryptocurrency market. Source: TradingView

Total market capitalization broke the crucial $ 270 billion barrier and immediately invested that level in support. This change in support / resistance was the beginning of an even more significant increase, as the total market capitalization touched the $ 350 billion level.

However, Is further continuation warranted? Very unlikely given the huge expansion of the past two weeks. A reasonable approach would be a test of previous resistance as a new support level of around $ 285 billion.

The bullish scenario for Bitcoin

BTC / USD 1-day bullish scenario chart

1-day bullish scenario chart of the BTC / USD pair. Source: TradingView

The bullish scenario relies on the crucial threshold of $ 11,300-11,400 as a pivot to hold Bitcoin’s price.

A bullish breakout would preferably see the Bitcoin price clear the $ 11,500-11,700 resistance zone and flip that area for support. As stated above, this is the final significant obstacle. If Bitcoin’s price breaks the resistance zone and conquers this level, further upside momentum can be expected.

The levels to watch if Bitcoin breaks this resistance are mainly the following resistance zones that are between USD 15,000-17,000.

The bearish scenario for Bitcoin

BTC / USD 1-day bearish scenario chart

1-day bearish scenario chart of BTC / USD pair. Source: TradingView

However, is such a breakout likely to occur after the recent expansion? It seems very irrational to break a resistance zone of such importance in an attempt.

A more reasonable approach is a renovated construction of limited scope, as it has been the previous months. The green zone between $ 9,700-10,000 is crucial to maintain. If that area turns into support (after rejecting the $ 11,500-11,800 area), a new range is defined, and the price of Bitcoin can move laterally for several months.

This limited range construction would also align with the 100-day and 200-day moving averages (MA), as they are still below the spot price. As long as this remains unchanged, the BTC price is in bullish territory.

What about altcoins?

Once Bitcoin begins to consolidate and correct itself, major altcoins will likely do the same, and then money will flow from Bitcoin and major currencies to smaller-cap coins and tokens. In other words, the current “altcoin season” may still have much more room to run.

The views and opinions expressed here are solely those of the Author and do not necessarily reflect Cointelegraph’s views. Every investment and commercial movement involves risks. You must do your own research when making a decision.

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