- Bitcoin price upside capped under $10,600, as well as the descending trendline.
- President Donald Trump is doing well but is hospitalized at Walter Reed National Military Center for treatment.
The cryptocurrency markets were shaken this week by the news surrounding the largest derivatives trading platform, BitMEX. Bitcoin tumble to $10,400 before recovering slightly to $10,600. Before the dust settled, information regarding US President Donald Trump testing positive for COVID-19 let hell loose as the flagship cryptocurrency dipped to $10,400 again. The second dive poked holes into Bitcoin’s ability to function as a safe-haven. Gold rallied above $1,900 per ounce as reported on Friday, cementing its long-standing position as the ultimate safe-haven for hedging against uncertainty in traditional markets.
Uncertainty mounts as Trump is hospitalized at Walter Reed medical center
After testing positive for COVID-19, President Donald Trump has been taken to Walter Reed National Military Center for treatment. Reports say that he has been administered with an anti-viral drug. The White House press secretary in a letter said the president is doing “very well.” He will, however, undergo “Remdesivir therapy,” as advised by specialists.
Bitcoin bears still on rampage
It is not clear how the news surrounding Trump will affect Bitcoin and the cryptocurrency market. However, the stock market dived into the red following the announcement. If the stock market continues to plunge, investors will likely start looking at alternative investments; Bitcoin is one of the biggest contenders.
Meanwhile, Bitcoin is still under heavy selling pressure despite the minor recovery above $10,500. The bellwether digital asset is dancing at $10,545. The price is holding at the 100-day Simple Moving Average. Bulls must keep Bitcoin above this level; otherwise, BTC could spiral to $10,400. Investors are clinging onto the edge of a cliff and any sign of unusual selling activity could trigger panic-selling and force Bitcoin back to the drawing board at $10,000.
BTC/USD daily chart
For now, a sideways trading action could take precedence, as highlighted by the Relative Strength Index (RSI). On the upside, gains above the descending trendline must come into the picture for Bitcoin to kick-start the recovery towards 50-day SMA at $11,000.
IntoTheBlock’s IOMAP model suggests that the path to $11,000 will be challenging to maneuver, especially with the range’s resistance at $10,500 – $10,850. Previously, 1.8 million addresses purchased 1.2 million BTC. The selling pressure in this area might absorb all the buying pressure pushing Bitcoin upwards. However, if buyers manager to turn it into support, gains above $11,000 may materialize.
Bitcoin IOMAP chart
On the flip side, the most robust support for Bitcoin lies between $9,300 and $9,600. The IOMAP model shows that 1.3 million addresses previously bought 840,000 BTC. In other words, Bitcoin could still explore the levels under $10,000 if the support between $10,200 and $10,500 gives in to the selling pressure.
Looking at the other side of the picture
If Bitcoin closes above the 100-day SMA, the bearish leg to $10,000 could be invalidated altogether. The flagship cryptocurrency is trading in an area with substantial (but not the strongest) support between $10,200 and $10,500. If this area holds, bulls will have a chance to focus on the resistance at $10,800. Moreover, a break above the trendline resistance could kick-start the recovery to $11,000.