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History Suggests Bitcoin’s Next Big Breakout Will Take Place at the End of 2020

Published

3 Monaten ago

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  • Bitcoin’s price has been showing signs of strength throughout the past few hours, finally pushing above $10,600
  • This strength is tempered, and bulls remain in a precarious position as they struggle to catalyze any sustainable uptrend
  • The entire market has been relatively quiet over the past few days and weeks, with many altcoins drifting lower as BTC shows signs of weakness
  • One analyst is noting that a historical analysis of Bitcoin’s present outlook suggests that it is still months away from posting a massive breakout
  • He believes that it is still in an accumulation phase and will begin rallying later this year

Bitcoin and the entire crypto market have been caught within a bout of sideways trading. Both bulls and bears have been unable to garner clear control over the market, which has created a sense of fear amongst investors and traders.

Where Bitcoin trends next may depend somewhat on its reaction to its range boundaries, which sit at $10,200 and $11,200.

Although neither of these levels have been broken as of yet, one analyst is noting that this may be due to BTC currently being trapped within an accumulation phase.

He believes that this will result in a major breakout by the end of 2020.

Bitcoin Struggles to Gain Momentum as Consolidation Phase Persists

At the time of writing, Bitcoin is trading up slightly at its current price of $10,600. Bulls have catalyzed some slight upwards momentum today, but it has not altered the crypto’s short-term outlook.

The next key price level to watch in the near-term sits at $11,000, as a break above this level would open the gates for a move up towards its $11,200 resistance.

If it faces another rejection at this level, it could deal some serious damage to its underlying market structure.

Analyst Claims BTC is Poised for a Late-2020 Breakout 

While sharing his thoughts on Bitcoin’s macro outlook, one analyst observed that Bitcoin may currently be caught within a re-accumulation phase, which eludes to a possible breakout at the end of the year.

“BTC. I’ve been asked for a bigger picture analysis. Looks like we are in re-accumulation phase, above the weekly 21-EMA. Possible breakout by end 2020,” he said while pointing to the below chart.

Image Courtesy of Wolf. Chart via TradingView.

If this potential path forward does come to fruition, Bitcoin could be on the cusp of starting its next macro uptrend.

Featured image from Unsplash.
Charts from TradingView.





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Bitcoin

‘Bullish year ahead’ — Bitcoin primed for Q1 2021 gains, strength index suggests

Published

3 Minuten ago

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Dezember 29, 2020

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The monthly relative strength index (RSI) of Bitcoin (BTC) shows the dominant cryptocurrency is primed for another rally.

Is 2021 an ideal time for a Bitcoin rally?

The RSI is a momentum indicator that measures whether an asset is overbought or oversold. When the RSI surpasses 75, it signals the asset is overbought, and when it drops below 30, it means the asset is oversold.

A pseudonymous trader known as “Crypto Capo” noted that the monthly RSI of Bitcoin is set to close above 80. Historically, when this has happened, BTC has saw a strong rally afterward.

Although the monthly RSI of Bitcoin is above 80, which is technically oversold, BTC’s RSI tends to become oversold for prolonged periods during a bull cycle.

The monthly RSI of Bitcoin. Source: Crypto Capo

Hence, traders often refer to an oversold RSI on a high time frame chart, like the monthly candle chart, to forecast an extended rally in the short term to medium term. The trader said:

“Monthly candle is about to close above 80. When this happens, bullish trend continues, with an avg. return of 1010.87%. Each cycle is shorter.”

However, the trader emphasized that one indicator cannot accurately predict the price cycle of Bitcoin. Crypto Capo explained that the combination of a few indicators could serve as guidance for the future. He wrote:

“You cannot base a prediction on an indicator. What we do is combining several methods to have a guideline for the future, to see what is more likely. But in the end, we adapt to what the price does in the present.”

“Bullish year ahead”

Traders have differing perspectives on where Bitcoin is headed in 2021, but most traders remain overwhelmingly bullish.

Cointelegraph Markets analyst Michael van de Poppe said he anticipates Bitcoin to reach $65,000 to $85,000 by next year’s end. He stated:

“I’ve got to revise my view on the potential level of $BTC at the end of 2021. Through this recent surge, I’m expecting it to be between $65,000-85,000 at the end of 2021. Bullish year ahead.”

Meanwhile, the options market is pricing in a 22% chance of Bitcoin achieving $120,000 by next year, which could also serve as a potential guideline on where BTC is heading in 2021.

In the short-term, however, some traders are cautious in entering leveraged positions. A pseudonymous trader known as “TheBoot” said the ideal scenario is to wait for Bitcoin to consolidate at $25,000 or enter after the next price upsurge. The trader explained:

“No rush to enter leveraged trades on $btc right here imo. Best would be to wait and long low 25k or even mid 24k. Alternatively, wait for the next leg up and then a dip from there.”

Cointelegraph previously reported that whales have been buying Bitcoin more aggressively since Christmas, which could buoy the mid-term bull case for BTC entering into 2021.