- BTC/USD is back below $6,400 support after an unsuccessful test of DMA50.
- The market needs time to understand and react to the positive news with longer-term implications.
Bitcoin is trading marginally below $6,400 handle, off Wednesday’s high at $6,464. The upside is effectively capped by DMA50 (currently at $6,456) and by the upper border of the recent range at $6,500. This area needs to be cleared for the recovery to gain traction with the first target at $6,800-$6,830 congestion zone that limited the upside since mid-September.
On the downside, the local support is created by the lower border of the short-term range (1-hour chart) at $6,350 and followed by a more significant $6,300 handle. Once below, the sell-off may be extended towards $6,200 and $6,148 (October 14 low).
Retarded reaction
Coinbase’s decision to offer support to Circle’s stablecoin USDC is a positive news for the cryptocurrency community, along with the announcement that the company received an approval to operate as a qualified custodian for digital assets. However, the market reaction has been muted so far.
Crypto experts believe that the recovery won’t happen immediately as the market needs type to access this type of news and see the outcomes of recent developments.
“It wouldn’t be rational to expect these types of announcements to affect bitcoin or other cryptocurrency prices in the short term. To paraphrase Jeff Bezos, the work that is being done today will be reflected in crypto prices 2-3 years from now,” Anthony Pompliano, founder and partner at Morgan Creek Digital, explains.
BTC/USD, 1-hour chart
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