Bitcoin, for the first time after several months, has broken the resistance level which suppressed its price. Coinmarketcap’s platform also reveals that for over a week now (asides from March 26), the virtual currency has been closing and opening above the $4,000 price level which is longer in comparison to other months in 2019. As at press time, Bitcoin’s price is $4,071 and its market cap is about $71 billion.
Bitcoin Enters a New Resistance Level
Now, that price and market cap is nothing new since it has traded around that range before, but what’s more remarkable is the fact that a new resistance level has been set. Predictions are currently flying around that it could be the light at the end of the tunnel which will usher in Bitcoin’s bull run.
But not so fast! While the market is showing an improvement in price, technical indicators are saying otherwise. If we base our judgment on the latter instead of what’s shown on indices, then a dump may just be underway. Now, let’s get a bit more technical.
Rising Pattern in 4-hour and 1-day Bitcoin Chart
The 4-hour and 1 day Bitcoin chart show that a rising channel pattern has been formed which can be compared to that of December 2018. The rising channel usually indicates a bullish opportunity to buy the asset. While this may be something to glory about, it isn’t. The latter is as a result of the current conditions which have triggered the rising pattern.
The first condition is a decline in trading volume which should’ve been high at the breakout point. Instead, the 4-hour chart shows a declining trend. Other conditions which have also led to the bearish conclusion are the 20-weekly moving average setting in a strong resistance, and the strong declining resistance line maintained by Bitcoin since February 2018.
Three Potential Resistance Levels for Bitcoin
Based on these conditions, there are speculations that the virtual asset will hit one of three resistance levels. These are $4,060 to $4,100 and $4,400, and if the digital asset eventually reaches any of these, then there is a higher probability for a bull run to occur.
Whichever is the case, many are bullish about Bitcoin’s price a few months from now. Arthur Hayes, for instance, believes that $10,000 is what we’ll get in 2019 and Mike Novogratz is confident that Bitcoin will trade around $8,000. CEO of CME, on the other hand, is of the opinion that Bitcoin’s price can increment on its own if the asset gets practical use cases.