Following a five-day losing streak, BTCUSD regained the upward momentum on Friday and is now within striking distance of the $10,000 threshold. Over the past week bitcoin shed about 20% of its value, but it was not the only digital asset suffering big losses, with the whole market was bleeding as well.
Technically, the latest retreat looked rather appropriate on the back of profit taking after another rally to local highs above $11,500. The reason for the sell-off was another wave of fears about the regulatory crackdown around the globe. In an unstable regulatory environment, it’s quite logical to cut exposure in the volatile and still immature market. The cryptocurrency was hit particularly hard after the US Securities and Exchange Commission announced it will require digital asset exchanges to register with the federal agency.
Despite the continuing speculations about the vague future of the highly underegulated and inconsistent cryptocurrency market, bitcoin continues to show a more stable dynamics since the December rout and therefore attracts more traders. The fact that the price makes higher lows in the daily charts, favors fresh bullish attempts in the short-term, with $11,500 area remains key for buyers. As long as the price is below this barrier, the upside risks are limited.
By Helen Rush
Senior Analyst at Capital Markets