The Bitcoin bulls didn’t get the memo on Wednesday, with Bitcoin only managing a 3.56% rise on day, partially reversing Monday and Tuesday’s losses, to end the day at $8,169.5.
A morning rally saw Bitcoin break out from the 23.6% FIB Retracement Level of $7,996.57 to hit a morning $8,168.8 high, breaking through the first major support level of $8,098.87 before seeing a pullback to an early afternoon $7,907.4 to call on buyer support at the 23.6% FIB Retracement Level of $7,996.57. A late afternoon rally saw Bitcoin hit an intraday high $8,237.2, testing the day’s 1st major resistance level for a 2nd time and this time managing to hold on through to the day’s end.
Bitcoin’s $7,870.5 intraday low hit in the early morning, managed to hold above the first major support level of $7,736.87, though the day’s gains paled in comparison to its peers, with Bitcoin Cash steeling the Bitcoin limelight on the day, surging 18.3%.
Wednesday’s moves provided some evidence that the U.S tax season may have had some influence on the cryptomarkets, though investors have also been relatively free from negative news from governments and regulators on planned roll out of new regs in the summer, which would have been another positive in recent weeks.
For the Bitcoin bulls, Wednesday’s moves suggest that Bitcoin Cash may be finding more favour in the market, the Bitcoin Cash fork providing much needed improvements that gives Bitcoin Cash a fighting chance in the real world. Bitcoin’s transaction speeds and fees an unrealistic alternative to the fiat currency world.
It may be too early to call a changing of the guard, but Wednesday certainly signals a shift and, while Bitcoin will likely continue to be the broader market’s barometer near-term, Bitcoin’s influence could begin to wane, Bitcoin’s dominance having eased to 40.1% from 45% levels back in late March. While dominance levels have tended to reflect cryptomarket conditions in the past, how Bitcoin’s dominance levels move in the coming weeks will be particularly interesting.
For now, Bitcoin’s miners have stayed put, with Bitcoin’s hash rate rising to 30.5385E, well above Bitcoin Cash’s 2.8637E, a cross-over having only taken place on 2 occasions back in 2017, the first on 23rd August and the second on 12th November, from which point the pair have seen a continued divergence in favour of Bitcoin.
At the time of writing, Bitcoin was up just 0.22% to $8,188.9, with the Bitcoin bulls looking to make up some ground on Bitcoin Cash through the morning.
It’s been a choppy start to the day, with Bitcoin falling to a morning low $8,032.2 in the first hour, before a bounce to an 8,284.9 morning high, the moves leaving the day’s major support and resistance levels untested early on.
Following Wednesday’s price action and Bitcoin’s failure to catch up with its peers through the day, investors may begin to turn fickle and look elsewhere for more sizeable rallies that could continue to pin back any more substantial gains in Bitcoin, though for now Bitcoin will likely catch up, investors yet to fully differentiate the cryptocurrencies by product offering and performance.
For the day ahead, a move through to $8,250 levels would support the start of a rally, any failure to move through to $8,250 levels and a run at the day’s first major resistance level of $8,314.3 likely to lead to a pullback later in the day, bringing sub-$8,000 support levels into play.
Bitcoin’s near-term bullish trend, formed at 6th April’s swing lo $6,500.2 remains intact, but a move back through to Sunday’s swing hi 8,458.8 is going to be needed to continue drawing investors back in.
This article was originally posted on FX Empire
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