Bitcoin registered a three-month high around $9,600 on Monday but was rejected from there and finished in the negative territory. Today, BTCUSD struggles for direction, oscillating around the opening levels at $9,200. Despite the local bearish correction, the leading cryptocurrency by market capitalization remains firmly in a bullish trend, with the $10,000 psychological level remains in traders’ focus. Moreover, it is possible that the pair will see a deeper correction below the $9,000 handle before another bull run takes place. In other words, a spike above $10,000 is still highly possible in the weeks to come.
The current resilience of the cryptocurrency market in general is contrasting with the dynamics in stock markets. While global equities continue to suffer losses amid the lingering concerns over the spreading of a China coronavirus, bitcoin as well as other digital assets enjoy a robust demand, which makes more and more investors to bet on BTC as a safe-haven asset. Of note, market sentiment has improved somehow since yesterday, and most stocks turned mildly positive, while a rally in bitcoin has stalled.
Should the retreat continue, the BTCUSD pair may get back below the $9,000 handle these days. In this scenario, market focus will shift to the 200-daily moving average around $8,850 which stands as the next support after the round figure. The cryptocurrency will then need to hold above this level in order to avoid a more aggressive profit taking. If this level fails to hold the potential downside pressure, investors may target the $8,000 handle in the medium term. anyway, upside risks still prevail in the market, with the possibility of extending the rally after a pause remains high.
In the longer run, bitcoin can be supported by the upcoming halving, which, according to history, drives the prices higher before and after the event. In the immediate term, bitcoin needs to regain the upside momentum and get firmly back above $9,470 to avoid a decline below $9,130.