- Bitcoin holds mostly above USD 8,000 but briefly fell to USD 7,959 on Sunday
- Bottoming out is looking likely, but renewed pushes towards USD 8,400 must take place for uptrend switch
- Fundstrat believes Bitcoin can rise 100% in 2020 running up to the Bitcoin halving event in May
Bitcoin is still in an unstable period now, unable to break new ground above USD 8,000, but holding mostly above it, although also recording a brief daily low of USD 7,959 (CoinDesk).
The Sunday bulls are nowhere to be found at the moment as Europe now trades in the afternoon, but could we be seeing the Americas resume an attack of key resistance points closer to USD 8,500 today?
Technical analysts and fundamentals on Sunday, however, are giving out bullish signals. We start the analysis with technicals, on the news that Bitcoin still did break out of its two-month range during this week’s USD 8,400 rally. But for it to break out of the downtrend, as we said before, it has to find a way to escape this current range for at least a week (above USD 8,000 at least.
Amid suggestions of bottoming out, we need to see confirmation of an upwards breakout, which is where we could be at right now. The next key resistance is found at USD 8,400, and this is where downwards trendline is hovering. It is really important for Bitcoin to move above this with strength and consistency, as this would then mean it can escape a crucial 7-month downtrend.
On the other hand, if we see that we keep breaking support at USD 8,000, then there is always a risk of losing the USD 7,600 support, which would likely trigger selloffs to accelerate a downward movement all the way towards USD 6,400 or even below USD 6,000; this might be the true bottom for 2020.
If we’re looking for more pointers as to where Bitcoin could be headed, then we might point at market capitalization, wehre USD 195 billion resistance seems to have broken on the upside. If we then see a successful push above USD 210 billion, we could be seeing a serious battle to break market cap resistance. If that happens, we should prepare for a strong move towards USD 250 billion as the next buyer target zone.
Whatever the outcome will be in the next few weeks, even crypto funds are getting bullish, with Fundstrat now certain that Bitcoin will do a 100% valuation increase this year — without halving even priced in.
In fact, according to the market research firm, price could rise significantly in the next four and a half months, up til the block reward halving estimated to take place in May. In its 2020 Crypto Outlook report, Fundstrat Global Advisors says that halving has not yet been priced into Bitcoin market, despite the event being already on most investors’ radars since at least last year.
Fundstrat co-founder Tom Lee shared some of the report’s findings on Twitter, saying:
“For 2020, we see several positive convergences that enhance the use case and also the economic model for crypto and Bitcoin — thus, we believe Bitcoin and crypto total return should exceed that of 2019… In other words, we see strong probability that Bitcoin gains >100% in 2020.”
Another key takeaway from the report is that Lee, along with other experts, are firmly backing the rising geopolitical tensions between the world’s nuclear superpowers as giving rise to Bitcoin price. Not forgetting US President Donald Trump is seeking reelection into a second term with the November presidential elections coming up in 10 months.
Events in late 2019 and early 2020 in Iran and Iraq, where the US maintains a significant military presence to battle Islamic State, saw Bitcoin rise to a high point. But last year’s price high was thought to be credited to the news surrounding Facebook’s Libra digital currency, amid scathing remarks on Bitcoin Tweeted by Trump.
Halving seems to divide opinions even among the same companies of experts, though. Morgan Creek Digital’s Anthony Pompliano was adamant that the scarcity pressure caused by halving would see a price rise to USD 8,700.
The Bitcoin halving is not priced in.
— Pomp 🌪 (@APompliano) November 10, 2019
However, his own colleague and co-founder of the digital asset fund, Jason Williams, believes that the May halving would be a Bitcoin “non-event”.
Only four months or so to finding out who’s right!
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