Most retail traders find it difficult to go against the herd and buy when the market is down. They generally wait for the price to recover and for improvements in sentiment before jumping in. By doing this, retail traders typically miss the larger part of relief rallies and pocket a smaller profit.
On the other hand, professional investors capitalize on sharp corrective moves by purchasing if they believe that the fundamental long-term trajectory remains intact.
Daily cryptocurrency market performance. Source: Coin360
New research by OKEx Insights and Catallact indicates that retail traders were shaken out by Bitcoins (BTC) crash in March and they did not return to the markets quickly due to a wait and watch approach. In contrast, larger players bought during the Black Thursday crash and continued to accumulate throughout the summer.
Now that Bitcoin has risen above the $10,500 resistance, do the charts point to a resumption of the upturned or is there a possibility of a reversal at a higher level?
Lets check the charts to find out!
Although Bitcoin turned down from the overhead resistance of $10,625 on Sep. 13, the bulls did not allow the price to dip below the immediate support at $10,200 and this shows accumulation was occurring at this level.
BTC/USD daily chart. Source: TradingView
If the bulls can sustain the price above the 20-day exponential moving average ($10,728), a quick move to $11,000 is likely. This will be the first sign of strength but the bears are unlikely to give up without a fight.
Traders looking to go short will likely attempt to defend the $11,000 level aggressively and this could result in a minor pullback. If the bulls are able to hold the next move to $10,625, it will increase the possibility of a rally to $12,460.
Contrary to this assumption, if the BTC/USD pair turns down from the overhead resistance and slips back below $10,625, it will su ...
Disclaimer: The content and views expressed in the articles are those of the original authors and are not the views of the editor and publishers of Crypto News.