TL;DR Ouch, where did that come from?

It was going so well. BTC was in a nice upward trajectory, with a sawtooth of higher lows pointing north to that all-important $10,000 mark. Then out of nowhere, last night saw a $350 fall back below $9,000.

While that’s not a particularly welcome development, it’s not the end of the world. Zooming out to the daily chart gives a broader perspective. For the past week or so we’ve been consolidating in a narrowing band of prices. It’s in the nature of markets to take two steps forward and one back – the saying is that the job of the market is to make fools of as many people as possible. That’s why any rally has setbacks or ‘corrections’, keeping people guessing.

For what it’s worth, the uptrend appears to be intact and there is, as yet, no need to panic. Right now we’re in the middle of the 50 and 200 MAs – those two moving averages that critics paid so much attention to earlier this year when they warned of the Death Cross. That 200 MA – which coincides with the $10k zone – will be a tough nut to crack because it will signal that a LOT of traders were wrong. In other words, a LOT of money has already decided that BTC is not worth $10,000.

Similarly, on the downside, that $6,000 low shows no sign of being revisited and $8,000 seems pretty unassailable. The dip below $9,000 was brief (as of the time of writing) but watch it carefully for further developments.

Whilst there’s still considerable uncertainty, then, there are fairly clear upper and lower bounds to bitcoin’s likely range for now.

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