Bitcoin astounds again – Testing $9,000, share up to 61% – What’s next?

Bitcoin astounds again – Testing $9,000, share up to 61% - What’s next?

We are running out of adjectives and adverbs to describe the meteoric rise of Bitcoin, a repeating record that excites, but no one wants the music to stop. History has already ruled once on Bitcoin’s asymptotic slope to higher realms, as analysts quickly draw comparisons to times gone by in 2017. Every phase of that last run up has been scrutinized, analyzed, and prophesized to no end in recent articles, but everyone acknowledges that the current bull bash is anything but sustainable for much longer.

Peter Brandt, a respected crypto analyst on social media, recently tweeted:

This is the FOMO phase of the advance. Once the majority of sold-out crypto bulls capitulate and chase this rally, a more sizeable correction will likely occur, stopping out the same bulls, who are chasing the advance.

Yes, one does have to take a breath when assaulting a steep uphill climb, but even folks over at CNBC’s Fast Money have taken to the new sport of cheering Bitcoin on: “It happened. Could $10K be next for bitcoin?” What is next for Bitcoin? It does not take a genius to look over the chart below and visually draw a trend line projection:

The lowest of the three “Red” lines designates the firm bottom that formed back in December at around $3,130. The middle “Red” line is set at $8,300, a significant point of resistance that was established last August, and the top “Red” line is, you guessed it, pegged at $10,000, a nice target, but also another one of those tough-to-get-by levels in the Bitcoin sky that resonated in May of 2018.

Most every analyst known to man, including a few harsh critics, has accepted that a true bottom was formed in December and that Crypto Winter had finally come to a close. The “Golden Cross” that occurred back in the first week of May seem to seal the deal. Two industry scandals drew concerns, but only for a few nanoseconds. On Sunday, BTC rocketed up 13.5%, peaking just over $9,000 before pulling back. It rests now at $8,845, as of this writing, as if poised to do more damage.

Before this past weekend, one pundit foresaw the way forward: “According to one prominent crypto analyst, the indecision has caused Bitcoin price to form a symmetrical triangle… According to Bullkowksi’s The Pattern Site, a symmetrical triangle breaks upward 60% of the time, after it reaches roughly 73% of its way toward the triangle apex… in this case, a continuation to the upside and an attempt at $10,000.”

Bitcoin broke through on Sunday. Analysts, however, remain in disbelief. The apparent preponderance of favorable fundamental factors has been discussed for weeks. It is “old news”, so to speak. A few notables have cried price manipulation, but no one seems to be buying into that notion. Whales are also on the move again, but why? The upward slopes of the MACD and RSI indicators in the above chart also signal that more upside may be in the works, even though each is also displaying overbought conditions. From a purely technical perspective, the “$10,000 level is a realistic bullish target”.

Bitcoin’s year-to-date gains have already achieved an amazing 142.4% up tick. Nothing compares on any stock exchange, a possible suggestion that Wall Street types that have stayed on the sidelines may be suffering from FOMO, as Brandt suggested. JPMorgan Chase has labeled Bitcoin as an overvalued asset that “has surged beyond its intrinsic value”, which is a rich statement coming from them, considering that they have continually argued that Bitcoin has no value at all. Perhaps, their resistance is softening.

Comments from the analyst community are all over the map, some expecting a major pullback, others warning of gravity, while a few reference the Bitcoin “halvening” event scheduled for May of 2020. Here are a few comments from the more thought out ones:

  • Well recognized cryptocurrency trader and investor Josh Rager: “The average gain after a 30%+ pullback was over 153% profit before the next strong pullback”;
  • Cred, an alias for a famous cryptocurrency analyst: “I have no reason to turn bearish yet – even if this range breaks down I’ll be a buyer at mid 6,000s (where we last wicked). A breakout would take us to roughly $10,000”;
  • Preston Byrne, one of the partners at New York-based Byrne & Storm: “If the looming bubble should spin wildly out of control, here’s a timely and healthy reminder to investors to keep their wits about them, don’t propose that a new paradigm is upon us, and be mindful of gravity;”
  • Tony Vays, a derivative trader: “I’ve been expecting my massive pullback for weeks. But if this bull run continues closer to the halving hype, then there may not be a significant pullback, and the halving hype can drive Bitcoin into yet another bubble.”

Bitcoin has once again made us all look in awe at its determination to regain previously lost ground. The $20,000 target is looming in the mist, but $10,000 seems a good way station for this current bullish breakout. Parabolic breakouts, however, are rarely sustainable, the reason why so many analysts are certain that a correction is due. The only questions from them is when and how large will the pullback be, but, to paraphrase one analyst’s quip, keep your wits about you and be mindful of gravity.

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