Whether this is the Consensus effect or not, Bitcoin (BTC) is now decidedly above $7,000. As of the time of writing this piece, BTC has finally tapped $7,400, a level that many see as short-term resistance. Let’s see what analysts are thinking right now.
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Analysts Weigh In On Bitcoin Move
Prices are moving so fast that analysts’ thoughts on the market are constantly cheering. But according to recent comments (which may not be relevant in a few hours’ time), Bitcoin may be locally topping.
STEM major-turned-Crypto Twitter mainstay, The Crypto Dog remarks that he thinks the cryptocurrency market is going to top right about here. In an explanation tweet, Crypto Dog remarked that while the price action is undoubtedly bullish from a bird’s eye perspective, BTC’s chart is making it seem like a local peak is forming.
The analyst didn’t fully explain this, but he did depict that BTC is currently encountering a resistance box (seen in grey below). What’s more, the parabola that BTC has stuck to for the past few weeks is about to go vertical, meaning that a drawdown is possible.
Others agreed with Crypto Dog’s analysis. Trader Cantering Clark explains that while the ongoing move seems “incredibly bullish”, BTC is still sitting under resistance, and is too far above its 20-week moving average. The 20-week moving average, according to Clark, has and is likely to continue to act as Bitcoin’s center Bollinger Band, meaning that it should return to that level’s vicinity in the near future.
He explains that as it stands, BTC is a “good three standard deviations from the norm,” with this move being fueled by retail shorts. This hints that Bitcoin may soon see a retracement, returning to more organic and sustainable levels as buying pressure slows in the coming weeks.
Room To Run?
Some have, however, argued that Bitcoin still has room to run. In a recent tweet, Mr. Anderson postulated that BTC’s parabola still extends higher. He explains that if the stars align, as it were, Bitcoin is likely to establish a short-term base in the high-$6,000s or low-$7,000s, before moving to and potentially beyond $8,000.
The fact of the matter is, this current rally is largely driven by those already in cryptocurrency, not those not involved in the crypto industry. As NewsBTC’s Joseph Young postulated on Twitter, “existing money in the crypto market [is] coming back due to overall growth in confidence/comfort.”
Google Statistics would confirm this. Popular researcher Alex Kruger explains that the “Bitcoin” search term’s volume is still at lows, with interest purportedly being 10% of what there was at BTC’s $20k peak in late-December 2017.