Bitcoin (BTC) price hit $ 12,000 again and traders are increasingly optimistic that the digital asset will stay at this key level.
So far in 2020, BTC has crossed the $ 12,000 level four times (all since August 2nd). Switching the central resistance level to support, however, was a very difficult task.
Daily performance of the cryptocurrency market. Source: Coin360
Three factors lead to an optimistic mood towards Bitcoin in the short and medium term: The potential catalysts are the devaluation of the US dollar, the strength of the support at USD 10,000 and the strong rally of Ether (ETH).
Influence of the factors supports the upward trend of Bitcoin
According to the cryptocurrency trader Scott Melker, the US dollar is losing momentum and it shows when the dollar falls off a 10 year channel and shows a clear rejection. milker said::
“The dollar seems to be dead, as I’ve been saying for months. Last week there was a strange euphoria that rebounded. Now the decades-long canal crash is clear. It should bounce back to test again at some point, but there’s nothing bullish about it. Good for BTC “.
Many analysts interpret the dollar’s devaluation as positive for Bitcoin, as alternative stores of value are valued in dollars. The dollar has lost a lot of ground against other reserve currencies in recent months. Coincidentally, gold and bitcoin have seen strong upward moves since mid-April.
The robustness of the $ 10,000 Bitcoin price increases the likelihood of a stronger upward move. It’s important to note that this is the longest period Bitcoin has hovered above $ 10,000 since it hit its all-time high in 2017.
Weekly chart of the XBT / USD pair. Source: TradingView.com
Eric Thies, a technical cryptocurrency analyst, hinted that Bitcoin could never go below $ 10,000 again. Said::
“We may never see #bitcoin below $ 10,000 again. The alts will also reach the moon. Did you get as much as you could while you could? … Or did the negativity + skepticism of the crypto bear market deter you from making an incredible investment? “
Based on the recent Bitcoin price history, Cryptowatch analysts expect BTC to hit several new all-time highs in November. Researcher they said::
“Bitcoin follows PlanB’s Stock to Flow (S2F) model very well. Assuming 10% of the coins are missing, BTC forecasts new all-time highs in mid-November and ~ 27,000 by the end of the year. “
An alternative scenario
Another scenario for Bitcoin in the short term It is a time of lateral consolidation, similar to what we have seen in years past.
BTC generally stagnates from September to early November and has been emerging since 2016. Based on this historical pattern, there is a possibility that the price of BTC could range between $ 10,000 and $ 14,000.
Cathy Wood, CEO of Ark Invest, previously said:
“We could stay in a new trading range, just slightly above the current 6-10 level. We could be in the $ 10,000-13,000 range. If anything, a breakout.”
A consolidation phase above the $ 10,000 support would be ideal for Bitcoin. This would strengthen the foundation for the next big uptrend.
An even more encouraging result would imply this BTC converts the range between $ 12,000 and $ 12,400 into support and then consolidates over $ 12,000. This would prepare the digital asset for a sharp move from $ 13,000 to $ 14,000.