I'm gonna ask what many people may consider to be
the dumbest question ever.
Why is the Bitcoin price important?
Now, before you ridicule me and call me the laughingstock of crypto,
hear me out.
Today's video is something you're gonna want to watch,
unless, of course, you're a cryptocurrency expert,
which, spoiler, you're not.
Let's get it.
Welcome to BitBoy Crypto!
My name is Ben.
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Now, in this video, we're going to be discussing why the Bitcoin price is important.
This is part of a new series of videos I'm going to be doing on this channel geared toward beginner and intermediate viewers.
Now, if you're new to crypto
and feel like sometimes you're lost when you're watching a news video or tutorial video,
make sure to tune in to this playlist.
In addition, guys,
if you want all the beginner info packed in together,
check out crypto4dudes.com.
This is my new crypto currency beginners course called The Regular Guys Guide to Crypto.
If you want to understand basic crypto and Bitcoin concepts and get better versed in the cryptocurrency culture,
then you should give it a shot.
It will help you to better understand the basics.
But today's video is all about the Bitcoin price and why it is important.
Now, of course, it's important so we can make money,
but it goes deeper than that.
You may hear traders or YouTubers talk about,
“Bitcoin must hit $12,000 today” or “I'm bearish”
or they may say something like,
“If Bitcoin drops below $9600, there will be blood all over the streets.”
Today, we're gonna be examining why these numbers are relevant.
What is the relationship between market direction and certain price points?
Okay, so really what it all boils down to is support and resistance.
These are the two most fundamental basics when it comes to technical analysis or Bitcoin charting,
and understanding what these two things are is pretty simple.
According to Investopedia,
The concepts of trading level support and resistance are undoubtedly two of the most highly discussed attributes of technical analysis.
Part of analyzing chart patterns,
these terms are used by traders to refer to price levels on charts that tend to act as barriers,
preventing the price of an asset from getting pushed in a certain direction.
Now, we're gonna look at what this actually looks like on a Bitcoin chart
here in a few moments.
But all you gotta really think about is that
support is where a price will bounce off of.
Resistance is where it will hit up against.
So, the support is the lowest price that we expect an asset to go, usually, in the short term.
A resistance is a number that we feel like Bitcoin will have a really hard time getting above.
So, also, let's see very specifically of what support is,
according to Investopedia,
Support, or a support level, refers to the price level that an asset does not fall below over a period of time.
An asset’s support level is created by buyers entering the market whenever the asset dips to a lower price.
So, basically, exactly what we just said.
Now, resistance, or resistance level, is the price at which the price of an asset meets pressure on its way up
by the emergence of a growing number of sellers who wish to sell at that price.
So, every time the price goes up,
let's say a trader on Twitter is talking about, “Hey, you know, we can't get above the $14,200 level.”
Well, the reason would be is because every time it hits $14,200,
sellers come into the market, and they push the price down.
Now, these are not just random numbers that people have decided upon,
like picked out of a hat.
There's very specific reasons for them.
You also have another set of numbers here---
Fibonacci retracement levels.
This is what some traders use to kind of get different numbers or price points,
but this is a different day for a different video.
But I want to make you guys aware of that.
Sometimes, these are where traders are getting their targets from,
but I think we really need to focus on support and resistance.
So, if we look here on this chart that was on an article entitled The Breakout in Bitcoin Is Here: These 3 Stocks Can Climb Higher,
we’re going to talk about the stocks. We're gonna talk about the breakout.
Okay, so what you'll see a lot of times on charts is you'll see lines drawn in a diagonal pattern, you know, upper left to down right,
and they'll try to do things like maybe hit the tops of candles
or the tops of the wicks, which are these very pointy parts at the top,
but this is a very beautiful picture of resistance
that we just met with Bitcoin in past
because it is actually a horizontal line of resistance.
You guys can see by looking at the chart, you would see right here $12,000.
$12,000 was a number that we could not get above.
There was one candle over here back in last year, in July,
where we kind of peaked over it a little bit,
but $12,000 to $12,500 is a very clear line of resistance.
We've actually tried to get over it once,
twice,
three times,
and this third attempt was a pretty long attempt.
This was our fourth move trying to get above this resistance,
and we finally did it.
So, now, because this candle--and we're not necessarily looking to the wicks.
We're looking at the candle bodies themselves.
Now that this candle body is above the resistance,
the next goal is to turn that into support.
We want to take this line,
and instead of the numbers hitting up against it, the candles,
we want it to be bouncing off of it. Okay?
So, this is why traders will say things like,
“Hey, once we get above $12,500, now, we're in a breakout."
Because now that the price is breaking out,
we are above the resistance.
We don't have anything necessarily holding the price back.
Well, kind of we do.
So, let's actually look at the weekly chart.
The weekly chart for Bitcoin is much easier to look at than the daily chart.
Nice, nice big candles here.
The daily chart gets a little bit crazy.
So, now, we're looking at the chart in real time here.
So, this back here would have been 2017 to 2018,
the parabolic run up and then the crash down, okay?
This would have been last year when we did like a little fake out.
A lot of people think it was because of the Plustoken Ponzi scheme that pushed the price up.
But, now, we are in the midst of a real move up.
And I mean, look at that momentum. Look at all these green candles.
We had a little bit of sideways action here after the halving.
But, now, we have been on the way up.
Okay, so we're going to draw a line here.
You can actually go back here all the way to 2018 in February and draw this over.
Now, it's not exact.
The point is, when you look here in August of this year,
we were able to get above the $12,000 level, the $11,500, we weren't able to keep it,
and that was important.
Your daily chart and your weekly chart is gonna look a little bit different,
but here's the point:
It's very easy to see that we have had a hard time around this level.
We've been getting pushed back, pushed back, pushed back.
Now, we have charged above it,
and we are well above this candle, or well above this line of resistance.
So the question here becomes,
what is next?
We hit $13,200. We bounced back down.
The $12,900 level has been holding pretty strong.
Well, we come over here and we look,
we suddenly now have a new line of resistance according to these wicks right here.
You will draw a line from this wick from last year in July to the one we just hit.
You guys will see $13,200 is a very important level.
So, that is a price that is important for Bitcoin.
We also can look at the next wick that wicked up, $14,000.
And you can see that right at $14,000, $13,900,
we have another level that we're going to want Bitcoin to go up above.
What happens after that?
Well, that's where things get interesting.
The next one is about $14,400.
But that's all the way back here on the descent from the bear market from the crash.
Once you get above this,
once you get above $14,400,
the next line is $16,100.
So, the point is,
if we can actually get above $16,000,
it looks to me like the next target is $16,000.
And I believe and I've said somewhere in between $14,000 and $15,000 is probably where we could see a rejection,
probably between $14,000 and $16,000.
I can see Bitcoin going up to $14,600
and then being pushed back down
and, you know, probably kill some of the momentum temporarily
before what we call moon time.
But that's the point, guys.
When it comes to understanding the prices of these traders are throwing out,
they’re not random numbers.
There's a reason. There's a method to the madness,
and it will have to do whether it is on a horizontal line or a diagonal line that looks kind of like a flag or a pennant.
Some people call them channels.
These are things that you really need to understand
when you're looking around Twitter,
you're watching YouTube,
you're trying to figure out what traders are talking about
when they're throwing out prices.
You should really reverse engineer that and go to a chart.
That's how you can learn how to do some very simple TA
and figure out where did they get that number from,
and that can point you in the right direction on how to chart,
how to do technical analysis,
and really what it all boils down to: make money in crypto.
I hope you guys enjoyed this video.
If you did, please make sure to give it a like.
Also, down below, drop some comments and some suggestions
for some topics that we can cover on this Bitcoin explaining series
where we look into simple crypto concepts for beginners.
Also, don't forget to visit crypto4dudes.com
to learn more about The Regular Guys Guide to Crypto.
That's all I got.
Be blessed.
BitBoy out.