- BTC/USD confirms its safe-haven characteristics.
- Strong support area comes on approach to $10,150.
Bitcoin (BTC) has built up a strong upside momentum during early Asian hours on Monday. The first digital coin has recovered from $9,900 and hit $10,665 high in a matter of hours amid strong bullish sentiments and growing trading volumes. At the time of writing, BTC/USD is changing hands at $10,419, up nearly 3% since the beginning of the day.
Flight to safety
As the US-China trading war ratchets up, investors rush to safety which pushes up the prices of safe-haven assets. China promised to retaliate by imposing tariffs on US goods when the US President Donald Trump introduced additional levies on Chinese imports and called for American companies to pull out of the country. This development resulted pushed 10-tear Treasury yield to the lowest since August 2016. Gold gained 1.3% to trade at $1,546.47 an ounce.
Bitcoin has been following this safe-haven pattern for a while now. The asset tends to grow amid a flight to safety, showing a tight correlation with gold’s prices. This time is no exception as investors consider the coin as a safe investment option at a time of economic and political turmoil.
Bitcoin’s technical picture
Looking technically, Bitcoin (BTC) is supported by 1-hour SMA200 (Simple Moving Average) at $10,300. Once it is out of the way, the downside is likely to gain traction with the next focus on $10,150. A confluence of strong technical indicators (SMA50 and SMA100 1-hour and the middle line of 1-hour Bollinger Band) is likely to stop the sell-off. However, a sustainable move below this handle pushes the price towards a critical $10,000.
On the upside, we will need to see a sustainable move above $10,500-$10,530 for the upside to gain traction. This area contains SMA200 4-hour and the upper line of 4-hour Bollinger Band. Once it is out of the way, the price may retest the intraday high of $10,665.