Bitcoin (BTC) recovered its weekly close losses on Aug. 28 as risk assets rose on China tax cuts.
BTC price 200-week EMA stands out as support
Data from Cointelegraph Markets Pro and TradingView followed a BTC price uptick into the day’s Wall Street open.
BTC/USD managed $26,226, marking its highest levels since Aug. 25 and fully compensating for weakness seen overnight.
News that China had cut tax on stock trading by 50% appeared to buoy U.S. futures into the open. The S&P 500 and Nasdaq Composite Index subsequently opened up 0.6% and 0.7%, respectively.
$BTC still in a 3 day composite but has shown signs of absorption below. I wish it was liquid enough like the ES or NQ to simply justify saying “Hold 26.1 and those singles at 26275 get cleaned up”
Strong drive off the open for stocks.
It’s Monday, so not looking to do anything… pic.twitter.com/6ObqBLIx5z
— HORSE (@TheFlowHorse) August 28, 2023
Eyeing the trading landscape for the coming week, Michaël van de Poppe, founder and CEO of trading firm Eight, flagged the 200-week exponential moving average (EMA) at around $25,700 as a key support zone to protect.
“First of all, the 200-Week EMA lies beneath us. It’s at $25,650 (Bitstamp) or $24,750 (Binance). The conclusion is, you don’t want to drop beneath that level and you’d preferably want to mimic 2015-2016 sideways period,” he wrote in part of an X post.
“If the 200-Week EMA sustains, conclusions are that we’re bottoming out here and we are potentially getting a massive entry point. If it’s lost, I’d be looking at a case of $19,500-21,500 as the next big entry point and final capitulation. On the lower timeframes and over the week, it’s still possible to sweep below the 200-Week EMA. As long as we don’t lose the level.”
Van de Poppe continued that order book liquidity “most likely” resided below the 200 EMA.
“In that regard, a sweep of that area is the most likely outcome,” he wrote.
“Two strategies can be deployed: 1 – Sweep at $25,750 for an aggressive long entry towards the other side of the range (entry can only be taken after the sweep and when $25,750 is reclaimed). 2 – Sweep of $25,200 towards $24,700-25,000 (the 200-Week EMA on Binance) and bullish divergences on higher timeframes. That’s the golden trade and could be the start of a reversal. However, $25,750 should be reclaimed in the bounce, otherwise this trade could be…
Click Here to Read the Full Original Article at Cointelegraph.com News…