Bitcoin’s price has been doing some phenomenal climbs recently. And it seems the bulls are having another go after a little pullback. Let’s have a look what’s been going on with BTC in the last 3 months and also have a guess where it’s headed.
Bitcoin Price Support & Resistance Levels
If we look back at how the Bitcoin price has been behaving this year we can see clear support & resistance levels. The bottom end for the past year has been bouncing back from around the $200 price mark. The top remained at around $300 until early November. Bitcoin’s support and resistance levels have always been nice and round numbers. Due to it’s great volatility we can assume that this will remain the same until a huge amount of day traders move into the market. The price has since moved up to $500 and also bounced back to $400 and $300 and is on the run again. Hence we can assume that the round numbers will remain for its price and resistance levels for some time.
In November this year the price plummeted to $500 after the EU Court Ruling on VAT. This ruling truly is important. Many countries still up to now decided to charge VAT on Bitcoin transactions. Which I find crazy. Think about it in fiat currencies – if you would have to pay 20% to the government when changing your Euros to Dollars that just wouldn’t make sense, would it. However many countries in the EU up to now were doing exactly that. Bitcoin is surely a currency or a payment, not classed as goods, assets or services. This also brought on a double tax issue. Now as this problem is out of the way many more businesses and merchants can start either accepting Bitcoin or start their business in the crypto field.
After the massive jump in November the price calmed down and came back down to the $300 level. This is completely normal and does not mean that the trend has reversed. I believe that the bulls are going to be strong with Bitcoin for a while now as we are starting to get over the stigma around it. By that I mean the opinion that it is something only for the geeks and it won’t really stay in the long run. Might I remind you that the same was said about the internet back in 1995…
The Bulls are Back
The price crossed the $400 level last night and I am expecting it to keep going at least until reaching $500. From there onwards if the resistance level of $500 is broken we would be looking at new highs around $600. If more positive news and announcements come up we might see the prices going even higher. So this is the great time to start buying again. I am certainly making my investments. Do be a bit cautious during the holiday period – bank holidays should be stayed away from when trading fiat, same can be said about cryptocurrencies. Reason being is the markets are closed on weekends and bank holidays. We will be seeing great innovations thanks to Bitcoin and blockchain technology. It’s definitely here to stay. Exciting times are ahead.
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Even though I try to give you the best advice possible, please understand that trading is risky and might result in the loss of some or all your investment. Never trade with capital you can’t afford to lose. This article was written on 9.12.15