Bitcoin pulled back a little as expected early last week, but then the bears came in with a big downward trend on Friday morning as Trump’s talk of raising tariffs on China sent markets crashing down.
Key Points
• Bitcoin News
• Outlook for the week
Bitcoin News
Bitcoin is testing a golden cross pattern that has sparked massive rallies in the past, with $110,000 emerging as the key level to watch. Analyst Mister Crypto noted on Sunday that this same pattern led to gains of 2,200% in 2017 and 1,190% in 2020.
A Golden Cross happens when Bitcoin’s 50-day moving average crosses above its 200-day average. This signals that momentum is shifting from down to up, often leading to price increases. Mister Crypto says the current setup looks very strong. If Bitcoin holds above $110,000, he believes the price could explode higher in the coming weeks.
Analyst Mac agrees the $110,000 level is critical but warns that losing it could signal trouble for this market cycle. He noted the four-hour Money Flow Index shows Bitcoin is deeply oversold, which usually means a bounce is coming. Mac thinks the setup looks good, but he doesn’t expect a huge jump right away. Instead, he sees choppy upward movement next week.
Fundstrat’s Tom Lee talked about recent stock market weakness, noting that markets rose 36% since April before Friday’s big drop. He pointed out the VIX volatility measure spiked 1.29%, marking one of the 51 largest spikes ever.Lee says these volatility spikes usually mark short-term bottoms because traders are hedging, not selling. He thinks markets will likely be higher within a week. The sell-off came after President Trump announced 100% tariffs on all Chinese imports starting Nov. 1. This was a response to China limiting exports of rare earth minerals.China controls about 70% of the world’s rare earth supply. The country just announced new rules requiring export licenses for products with more than 0.1% Chinese rare earths, starting Dec. 1.
Outlook for the week
A big bounce after such a steep sell-off was to be expected, and we got that into the weekly close. So it’s hard to know what to expect going into this week. Oscillators on the daily chart are still biased bearish, but not overly so, so bulls still have a chance to save face here. Over the next few days, bulls will want to avoid closing any days below the 0.236 Fibonacci Retracement at $110,500 as that opens up the $105,000 low once again.
On the flip side, bears will look to keep the price below the 0.618 Fibonacci Retracement resistance at $118,350. Getting above here flips bias back to the bulls over the short term, but they have an uphill battle to do it. We have a neutral zone between $112,000 and $118,350, with $115,630 being the divider for bullish and bearish bias within this zone. So we may see bitcoin remain stuck in this zone over the next few days.
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