- Bitcoin (BTC) retests significant resistance
- Warren Buffet bashes Bitcoin for the second time
After describing Bitcoin as Rat Poison Squared, Warren Buffet now says the asset is a gambling device. Even so, Bitcoin is retesting Q2 2018 lows and immediate resistance at $6,000, adding 6.3 percent in the last week.
Bitcoin Price Analysis
The Oracle of Omaha is back. Warren Buffet may be one of the wealthiest people in the world but he, like most billionaires including Bill Clinton, is dismissive of Bitcoin. Although Bitcoin is one of the million applications that can operate from Blockchain, Warren says Bitcoin is a “gambling device” that “hasn’t produced anything” and laden with controversies. While talking to CNBC, here is what the admired multi-billionaire said:
“It’s a gambling device… there have been many frauds connected with it. There have been disappearances, so there’s a lot lost on it. Bitcoin hasn’t produced anything. It doesn’t do anything. It just sits there. It’s like a seashell or something, and that is not an investment to me.”
Bizarrely, he compares Bitcoin with buttons adding that “Bitcoin sits there” and he’ll
“I’ll tear it here. What I’ll have here is a little token…I’ll offer it to you for $1000, and I’ll see if I can get the price up to $2000 by the end of the day… However, the button has one use, and its minimal use.”
Even so, Bitcoin is a proven conduit that has made international fund transfer cheap and near instantaneous. The world’s liquid asset is also evolving into a store of value, a trusted asset that is global with no FX charges.
At spot rates, Bitcoin is a top performer adding 6.3 percent in the top 10 and only trailing Cosmos in the top-15. Despite what Warren thinks of Bitcoin (BTC), the asset is a utility, and increasing support from governments means the resulting demand would push prices to a new high above $6,000 towards $8,500.
It’s easy to see why—candlestick arrangement thus far support bulls as prices trend above a multi-month resistance trend line visible in the weekly chart. Although we need BTC bulls to conclusively drive prices above $6,000 invalidating bears of Q4 2018, BTC is under immense bear pressure.
From a top-down approach, Nov 2018 bears anchor our trade plan with effort versus result analysis pointing to bears. Therefore, for traders who miss today’s leg, they can as well stay on the sidelines until prices edge past $6,000.
For a clearer picture, Nov 2018 bear bar anchors our trade plan. Bulls have a chance, but for trend continuation and confirmation of April surges, BTC must close above $6,000 with high volumes exceeding 954k.
Chart courtesy of Trading View