Are the crypto bulls awake?
The cryptocurrency market has again attracted the attention of many people, because most of the major cryptocurrencies registered solid price gains last week. For instance, Bitcoin (BTC) increased from $7,212.70 to $8,442.00, Ethereum (ETH) - from $135.09 to $147.98, Litecoin (LTC) - from $43.22 to $51.76, etc.
The positive market sentiment has woken the crypto bulls and many of them showed up with their optimistic price predictions again. On Jan. 9 Sonny Singh, BitPay Inc. chief commercial officer, in an interview with Bloomberg predicted a new all-time high for Bitcoin in 2020. He based his price prediction on unforeseen events such as the recent US-Iran political tensions.
Fundstrat co-founder Thomas Lee, another well-known Bitcoin bull, wrote a tweet on Jan. 10, claiming that Bitcoin can deliver 100% returns to investors in 2020:
Bitcoin starts the new week with a price hovering above the key psychological level of $8,000 per one digital coin. According to Coin360, at the moment 1 Bitcoin costs $8,091.37:
Daily crypto market performance. Source: Coin360.com
Bitcoin Technical Analysis
On the daily chart (D1), the price of Bitcoin has almost reached the upper line (resistance line) of the «descending channel»:
The current situation is very interesting because, according to technical analysis theory, there is a «bullish flag» as shown in the chart of BTC/USD:
The «bullish flag» is a continuation pattern characterized by a clear upward direction of the price («flag pole»), followed by a correction («flag»), which is then followed by a resumption of the trend («continuation»).
The Bitcoin traders and investors will closely monitor the price behavior within the «flag», in order to be able to spot a potential breakout signal (buy signal) or a potential price reversal (sell signal).
In case of a breakout (bullish scenario), the first price target is the 61.8 Fibonacci retracement level or $9,490.80. In case of a price reversal from the resistance line (bearish scenario), the first price target is the 38.2 Fibonacci retracement level or $7,182.10:
In conclusion, BTC/USD is at a critical moment - there is still neither a clear buy signal nor a clear sell signal on the daily chart.
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The analysis is purely informational and does not constitute investment, financial, trading, or any other sort of advice and you should not treat any of Bitvalex’s content as such. Bitvalex does not recommend that any cryptocurrency should be bought, sold, or held by you. You are solely responsible to conduct your own due diligence and consult an advisor before making any investment decisions.