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Analysts Watch Crucial Bitcoin Support as Altcoins Gain Momentum

Published

1 Monat ago

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  • Bitcoin has been inching lower throughout the past few days and weeks, with buyers and sellers both being unable to take control of its near-term trend
  • This slight decline has come about following a period of immense strength and stability as it consolidated above $16,000
  • If it continues trading below this level, its recent $16,500 highs could mark a long-term top
  • Where it trends next may depend on one key support level that an analyst is closely watching
  • This price action could prove to be beneficial for altcoins, however, as many tokens are currently rocketing higher despite BTC’s pullback
  • If this trend persists, then this could mark the start of the next “altseason” – where investors move money away from the larger digital assets and towards higher risk ones

Bitcoin is in the process of reeling lower today, with sellers gaining an edge over buyers as the support at $16,000 shows signs of dissolving.

Where BTC and the rest of the market trends next will likely depend on tomorrow evening’s weekly candle close. If it can surmount this level and close above it, bulls could regain control of its price action.

One trader believes that a continued bout of consolidation could bode well for altcoins, potentially allowing them to continue rocketing higher.

Bitcoin Hits Critical Support Level 

At the time of writing, Bitcoin is trading down just over 3% at its current price of $15,820. This marks a notable decline from recent highs of $16,500 set at the peak of its recent push higher.

This decline has sent it down to its key support at $15,800, which is a level that has long been watched by analysts and investors as a key support level.

If broken firmly below over any higher time frame, it could be a sign that downside is imminent.

Analyst: Altcoins Looking Strong Despite BTC Weakness 

One analyst observed that altcoins are looking strong despite the declines seen by ETH and BTC today.

He also notes that Bitcoin is now trading above a crucial high time frame support level.

“$15,800 crucial support for BTC HTF… If it breaks, expecting a pretty significant pullback across the board, ETH is also at key support here at $460 currently. That said, lots of alts are still looking good today…”

Image Courtesy of Cactus. Source: BTCUSD on TradingView.

The coming few days should provide insight into the long-term significance of this move. Where it trends next may depend largely on its weekly candle close tomorrow.

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

19 Minuten ago

on

Dezember 29, 2020

By


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.