Bitcoin Could Stair-Step Higher
Bitcoin (BTC) still seems to be piping hot. As of the time of writing this article, the aggregate value of all cryptocurrencies remains at $175 billion — just shy of the year-to-date high established late Wednesday night. This effectively non-stop bullish price action, which pushed BTC well above $5,200 mere hours ago, however, has led some to claim that a short-term pullback to under $4,800 or even lower could be inbound.
According to Todd Butterfield, an analyst at the Wyckoff Stock Market Institute, though, BTC might not collapse. In fact, Butterfield writes that if the crypto asset follows his bullish Elliot Wave chart, which accurately predicted this 25% rally, there aren’t any “real sell reasons.”
The above chart shows that Bitcoin will likely return to $4,900, which is a bearish move ongoing as I write this (BTC just dipped to $4,980), before ranging between $5,000 and $5,700 until the end of May. This should then be followed by an eventual rally to $7,200 potentially by June, which is where Butterfield’s model ended.
While this sounds hard to believe, especially considering the brutal bear market that ravaged traders over the past 14 months, he isn’t the only one bullish on Bitcoin’s prospects.
Brave New Coin’s Josh Olszewicz recently noted that BTC on its daily chart recently closed above its Ichimoku Cloud, a multi-faceted indicator used to show levels of support and resistance, for the first time in 442 days, when this market established a top prior to crashing dramatically. Considering that Bitcoin traded above its Cloud during much of 2017’s rally, this sign has been deemed bullish by many traders.
The fact that BTC continues to trade above its 200-day moving average (200 MA) has also pleased investors. Fundstrat’s Tom Lee recently remarked that Bitcoin “acts significantly better” when it trades above the aforementioned level, which has acted as an overarching level of resistance for much of the past year. In fact, 80% of the time that BTC traded above its 200 MA there was a “win” (an average six-month forward return of 193%), compared to a 36% “win-ratio” when the tables were turned.
Fundamentals, too, have also signaled that BTC remains strong, and that this 25% spike could be well warranted taking all things into account. Canadian industry researcher Kevin Rooke recently compared Bitcoin’s fundamentals at current and how they fared on October 12th, 2017, when BTC last moved above $5,000. While active addresses and on-chain transaction throughput are down slightly, the network’s hashrate, block size, and community size (gauged through subscribers to the official Bitcoin subreddit) are up dramatically, nay parabolically.
Even CNBC’s Brian Kelly joined in on the bullish fun on Tuesday’s edition of CNBC “Squawk Box.” As reported by Ethereum World News previously, the BKCM CEO explained that considering the growth of institutional interest, the recent launches of custody solutions, booming volume, and a growing numbers of tired short sellers, $6,000 could very well be in BTC’s short-term cards.
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