Bitcoin may find support near level of 28,000

17 August 2023 176
Bitcoin may find support near level of 28,000

Today bitcoin quotations updated the lows since mid-June, falling below 28,500. The price of the main cryptocurrency is gradually approaching the support located at the round level of 28,000. It has often been noted that major investors prefer to increase their long positions when bitcoin quotations are declining rather than during active growth. A similar scenario is possible in the current situation.

The current drop in bitcoin price is due to yesterday's minutes of the last Fed meeting. Investors were frightened by the statements of officials of the U.S. regulator regarding the remaining possibility of interest rates hike. At the same time, the document shows that at least two of the Fed's voting members spoke out against the increase in rates on July 26. In the fall, these hawkish views should be even softer. 

Bitcoin quotes can also be supported by yesterday's news from the Coinbase exchange. It received permission from the U.S. National Futures Association (NFA) to access trading in futures contracts on the cryptocurrency to retail customers. Until now, only institutional investors could use cryptocurrency futures in the U.S. Given that almost 80% of all world cryptocurrency trading is conducted through derivatives, the NFA's decision will allow U.S. retail investors to increase their market presence seriously.

From a fundamental perspective, the approaching halving will contribute to bitcoin's growth. Mark Yusko, founder of Morgan Creek Capital Management, expects bitcoin quotations to rise to $55,000 by April 16 next year. This is the date of the fourth halving in history. At the same time, the value of the main cryptocurrency could reach $100,000 by next summer and $150,000 by the end of 2024.

Bitcoin's price descent to 28,000 looks like an interesting opportunity to build up long positions. The first target of the quotation's upward rebound will be the recently broken support of 29,000. Further, the way to the August highs near 30,000 will be open.

We may offer you the following option of trading strategy: 

Buy BTCUSD in the range of 28,400 – 28,600. Take profit — 29,000. Stop-loss — 28,000.

Also, traders can use Trailing stop instead of fixed Stop-loss at their disposal. 

This content is for informational purposes only and is not intended to be investing advice.

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