Bitcoin made a flash dash above $6,700 late Friday but it didn’t last. It was a good sign though of firming up for a weekend assault on $6,800.
On Saturday bitcoin has been trading between $6,640 to $6,563 so far, and is currently towards the bottom of that range.
For now the battle remains around the $6,600 resistance level but with volume low at $3.2 billion, we expect to see some oscillation with some spinning top candles perhaps appearing in renewed tests of $6,700.
Suffice to say bitcoin is poised for a breakout but we’ve been saying that for a few days now. See technical analysis below.
Good news piling up
More confirmation from the industry that we are at the bottom came from the announcement of the first direct investment in cryptoassets by the Yale endowment although the actual amount hasn’t been disclosed.
The Paradigm fund was co-founded by Fred Ehrsam, (a Coinbase co-founder), Matt Huang, former Sequoia partner, and Charles Noye formerly of Pantera. Paradigm will invest in crypto startups such as blockchain platforms and exchanges.
The fund has raised $400 million. The Yale endowment is managed by chief investment officerDavid Swensen since 1985, chalking up an annual return of 12.7%. The Ivy League college’s endowment is valued at $27 million, making it the second largest in the US behind Harvard.
Bitwise the crypto asset manager announced onWednesday that Ric Edelman is an investor and will also be advising the company, Edelman is the founder of $22 billion RIA Edelman Financial Services.
TDAmeritrade swooped in for a stake in new spot and futures exchange ErisX. In similar remarks to those of the boss of Brazilian broker GrupoX, TD Ameritrade said the acquisition follows client demand for access to crypto.
“We continue to see our retail clients seeking access to trade digital currency products,” JB Mackenzie, managing director of futures and foreign exchange for TD Ameritrade, told CNBC in a phone interview. ” We wanted to find a platform that would be fully regulated, and something that has that capital markets feel.”
ErisX is regulated by the Commodity Futures Trading Commission.
The market may appear to be discounting the good news but that may disguise something else more important going on – the quality of the market is improving as more institutions and big ticket private investors start to take positions.
For the retail investor who has had their fingers burnt a change of mindset will take longer.
BTCUSD has three times (circled in black) asked for support at $6,611, $6,626, $6,640 in a succession of higher highs, which is a signal for a concerted effort brewing (see the dashed red lines).
But what grabs our attention is the session high at the last bar of 5 October which registers at a flash $6,741. The close for the hour candle is much lower of course but it shows willing intent. At pixel time the buulls are in charge in the third trough, attacking the 50-day moving average (green line).
Bulls should be confident of both a floor at $6,550 while bears will want to see if there is a break above the 50MA. If that doesn’t happen over the weekend then the ranging will continue, opening up the possibility of a return to the $6,400s of two days ago.
Gary has been writing about cryptocurrencies since 2013 and currently works as the cryptocurrency analyst at interactive investor, the UK’s second-largest online investment platform. Gary contributes for Coin Intelligence News in a personal capacity and none of his commentary should be considered investment advice. Gary is the winner of the ADVFN International Financial Awards 2018 Cryptocurrency Writer of the Year. Contact Gary on twitter at: @gary_mcfarlane