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Here’s How Bitcoin Could Spark a Massive Move Higher for Smaller Altcoins

Published

4 Wochen ago

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  • Bitcoin has seen some wild price action throughout the past few days and weeks, with the selling pressure seen at its all-time highs sparking multiple rejections
  • Neither of the rejections seen at this level have done much to change the crypto’s trend, as it continues pushing higher each time
  • Where the entire market trends next will depend largely on whether or not BTC can stabilize within the lower-$19,000 region
  • Each visit to its highs degrades the resistance existing here, meaning that it may only be a matter of time before it is broken above
  • One trader is noting that, if history rhymes, Bitcoin breaking above its all-time highs could be all that is needed for smaller crypto-assets to see massive upside

Bitcoin has been guiding the entire market throughout the past few days and weeks, which has subjected altcoins to immense volatility.

Yesterday morning, BTC rallied as high as $19,800, which marked an all-time high on some exchanges.

Despite being a historic moment, bears still tried to fade the move and sparked a strong rejection at this level. This led BTC down to lows of $18,200 before it found some strong momentum and rallied significantly higher.

It is now back within the lower-$19,000 region and looking strong, meaning that this may have once again been another bear-trap.

One trader expects a break above Bitcoin’s all-time highs to spark a serious upside movement for altcoins.

Bitcoin Rallies from Lows, Creates Tailwind for Altcoins

At the time of writing, Bitcoin is trading down just under 2%.

This marks a decline from its recent highs of $19,800 that were set yesterday and marks a notable surge from lows of $18,200 set just a few hours ago.

The potent reaction to this selloff does seem to indicate that upside is imminent for the cryptocurrency.

Trader: BTC Breaking Its All-Time Highs Could Catapult Altcoins Higher 

This recent BTC turbulence has had massive impacts on the price action seen by altcoins.

One trader is now noting that a break above Bitcoin’s all-time high is a historically bullish event for altcoins, despite a common narrative that suggests BTC entering price-discovery could hamper the growth seen by its smaller counterparts.

“In last 2 cycles, alts rallied extremely hard each time BTC broke its old high, will it be the same again?”

Image Courtesy of CL. Source: TradingView.

Assuming that history rhymes, as it so often does, this means that the next few days could be massive for the future of altcoins, as Bitcoin is once again just a stone’s throw away from fresh all-time highs.

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

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.