Doji & 50 M.A. Underpins Bitcoin
The BTC/USD was closed at $39,922.0 after placing a high of $42,532.0 and a low of $39,596.0. Bitcoin reached its highest since 19th May level during the early trading session on Friday but failed to remain green for the day as traders started booking profits. A U.S. asset management giant, GoldenTree Asset Management which has $45 billion in assets under management AUM, announced that it has purchases portions of Bitcoins and added them to its balance sheet.
The company is said to add bitcoin because it wanted to diversify from traditional debt investment strategies. The wealth management firm was looking for staff that understands crypto solutions and blockchain tech. This news added to the price of bitcoin during early trading hours on Friday.
Furthermore, the government of Germany passed the law that will enable German institutional funds to hold up to about 20% of their assets in terms of cryptocurrencies. The latest German law will go into effect from Aug 02, and this initiative could bring about $415 billion worth of investments via cryptocurrencies. This was another piece of news that added further strength to the prices of Bitcoin over the weekend. Meanwhile, Wealthfront has also announced that it would increase the cryptocurrency exposure to its clients by adding Grayscale Bitcoin Trust and Grayscale Ethereum Trust.
This service will not require the clients to use wallets or open an account in a cryptocurrency exchange. The company also warned that such investment could be risky and more volatile than most ETFs and would limit the initiative. This was another factor involved in the rising prices of BTC/USD. Moreover, there were also reports that the former SEC Chairman Jay Clayton was fighting for an approval of Bitcoin ETF. While, on the other hand, the newly-appointed SEC Chairman, Gary Gensler, was continuously working towards establishing a regulatory framework for digital assets.
Clayton, currently serving on the One River Asset Management board, has recently submitted a registration statement for One River Carbon Neutral Bitcoin Trust. This fund is the latest attempt at getting the long-awaited Bitcoin ETF approval in the U.S. Clayton is actively involved in the application process and is considering the experience of the former SCE head, and people are suggesting that this fund has good odds at getting approval from SEC.
The declining prices of Bitcoin over the weekend could be attributed to profit-taking and the strength of the U.S. dollar. The DXY reached 92.20 level on Friday amid the renewed strength against the basket of six major currencies as the inflation was rising higher than the central bank's expectations. The chairman of the Federal Reserve, Jerome Powell, said that inflation might remain at higher levels for some time, but it would be transitory.
BTC/USD Intraday Technical Levels
Support Resistance
38834.6 41770.6
37747.3 43619.3
35898.6 44706.6
Pivot Point: 40683.3
BTC/USD - Technical Outlook
On Monday, the BTC/USD pair is retracing back to trade below the psychological trading level of $40K. The Bitcoin is now trading at 39,650 level, gaining immediate support at 39,180 level. This support level is given by the 50 M.A. (moving average) on the 4-hourly chart. The closing of a spinning top candle above this 39,180 level is supporting slight bullish sentiment in Bitcoin.
A bearish breakout of this level can expose the Bitcoin price towards the next support level of 38,315 and 36,510 levels. Conversely, the breakout of a 40,500 level can expose the BTC/USD price towards 42,470 level. The MACD is also supporting a buying trend in Bitcoin on Monday. All the best!
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