Bears couldn’t keep Bitcoin suppressed for long. On Monday morning, the price of the leading cryptocurrency broke higher once again, rallying from $9,800, where it had found a short-term base of support after a weekend slump, to $10,400 in the span of a few minutes’ time. This represented a 6% move higher.
While this may be a coincidence, the timing of the strong move higher — which liquidated $50 million worth of short positions on leading derivatives exchange BitMEX — was eerie, as the start of a Bitfinex maintenance session saw BTC start surging higher.
Some have speculated that traders closed their short positions on Bitfinex prior to the maintenance, creating upward price pressure.
Whatever the case, analysts expect Bitcoin to mount higher and higher in the coming days and weeks, citing the fact that the technical and fundamental outlook for the cryptocurrency remains decisively positive.
Bitcoin Still in Uptrend, Many Analysts Conclude
Dave the Wave — the pseudonymous crypto trader that in the middle of 2019 predicted a decline to the $6,000s for Bitcoin (it happened) — recently asserted that the cryptocurrency is still on track to hit $11,000 to $11,500 before seeing any sort of pullback.
This prediction is based on his charting, which says that BTC will push towards the top of a long-term downtrend in a parabola-like fashion.
Reversal back up again. The big IF of the above chart didn't eventuate. How high can it go? Looking at the second to last chart above – 11K range before the '50%' consolidation [in real terms].
Minor view – break out here and now of the triangle formed, the dominant pattern. pic.twitter.com/28wSdV1NkL
— dave the wave???????? (@davthewave) February 11, 2020
Dave the Wave’s call for Bitcoin to enter the $11,000s has been echoed by a number of other prominent analysts.
Filb Filb, for instance, said that he expects for Bitcoin to rally to $11,500 in the coming weeks because it closed last week’s candle above the key $9,500 level, which has acted as macro resistance and support on many occasions. Filb Filb predicted BTC’s price trajectory for Q4 2019 and the start of 2020.
Also, Jacob Canfield, a full-time crypto trader, has begun to eye the $11,300 to $11,400 region as a potential place for the cryptocurrency to trend in the coming weeks, noting that there exists a long-term trendline at that level.
Bloomberg Warns of Crypto Market Pullback
Although most crypto traders are convinced that more upside is imminent, Bloomberg has warned that some downside may be imminent.
In an article entitled “Bitcoin Drops From $10,000 While Technicals Point to Pain Ahead,” the outlet wrote that BTC could drop further from here simply because last time it crossed the key psychological level of $10,000, it struggled:
It similarly struggled with that level in September when it crossed $10,000 — the month that followed saw it lose more than 14%.
The company added that the “token is overbought based on the 14-day relative strength index (RSI), which crossed the 70 mark.” The RSI says that an asset is “overbought” when the metric passes 70, for it signals that bulls are overextended.
These two factors in tandem, Bloomberg wrote, “suggest a potential retreat ahead as the coin struggles to meaningfully break out from its recent trading range.”
Not to mention, Thomas Thorntown of Hedge Fund Telemetry recently noted that the TD Sequential Indicator printed a 13 candle, often a sign of a reversal in markets.
— Thomas Thornton (@TommyThornton) February 10, 2020
This signal is important because the TD Sequential has been extremely accurate in calling Bitcoin’s macro inflection points over the past few years; for instance; it printed a 13 at the $6,400 bottom in December of 2019.
This historical precedent of 13 marking trend changes in Bitcoin implies that the next few weeks will see BTC retrace a handful of percent, maybe more, lower.