Yesterday bitcoin's price kept its uptrend, and today is holding quite well above the critical support level of $50,000. In the past 24 hours, BTC/USD remained flat and was trading close to $51,000, according to CoinGecko, at the time of this writing.
We're quite bullish on the short-term price of bitcoin since it is holding above $50,000. As we predicted, this level is essential for bitcoin to start a new rally toward $60,000. For our analysis to remain valid, we hope new buyers continue to enter the market.
Additionally, we notice how bitcoin's price did not reach the 20-day Modified Moving Average (MMA) a second time and simply began to push up. If we look at the Volume Profile Visible Range (VPVR) on the left, the reason becomes quite clear: there is much buying support around $49,000.
In terms of news, Forbes' Clem Chambers discussed his bearish case for bitcoin, pointing out that
"for bitcoin to break into a valuation of multiple trillions seems, at least for now, a hard goal to reach."
He points out how volatility is decreasing, which usually means the rally has come to an end. Still, we think there's plenty of room for BTC/USD to grow, and we'll discuss why in the next section.
In summary, bitcoin's price traded within the predicted range (blue), and as we expected, found strong support above $50,000. Therefore, the current week will most likely be extremely positive for the short-term price of bitcoin.
We remain bullish on BTC/USD as long as:
- BTC/USD remains above its 20-day MMA (red), 50-day MMA (green), and 200-day MMA
(blue). - BTC/USD doesn't drop below $49,000.
- BTC/USD daily volume goes above its 21-day Moving Average soon
What Do Traders Think?
Today’s first tweetstorm comes from Larry Cermak, Director of Research at The Block.
Cermak explains his optimism and positivity around bitcoin’s price growth in his series of posts and why he thinks the show will most likely continue.
The researcher first points out,
“Spot volume reached another all-time high of more than $1T last month. More than 3 times higher than 2017 top.”
This data shows that adoption is on the rise since more users are now buying bitcoin than in the previous bull run of 2017. Still, Cermak adds that
“Google search volume for Bitcoin is still lower than it was in 2017,”
which shows plenty of room for bitcoin’s price to grow. Not only that, but he explains that
“Web traffic of crypto exchanges reached 432M in February, which is still 20% lower than in January 2018.”
Adding to the above, Cermak writes that “Futures now have around $15 billion of open interest for Bitcoin, which is more than four times higher than just a year ago.” and that
“Options have seen massive growth in the last year as well - to the point that now the large expiries actually play a role in price discovery.”
which is an excellent sign that professional investors and traders are quite keen in using bitcoin as a speculative asset.
Another critical sign highlighted by Cermak is that
“Grayscale is currently (...) generating $70M a month from just from the fees. Grayscale now has 655.5k BTC and 3.17M ETH.”
To conclude his thesis, the researcher shares a few bullish on-chain metrics. First, he writes that “Bitcoin is settling $10 billion of value a day,” and then adds that
“In the past few weeks, both Bitcoin and Ethereum miners have been generating more than $50 million a day in revenue.”
In our opinion, Cermak’s thesis proves that the market is justifiably extremely bullish on bitcoin’s price, as adoption keeps rising, not only by retail investors but, more importantly, by institutions and professional traders.
The next post comes from Bitcoin Jack, a trader and market analyst.
In his post, Bitcoin Jack shares the “Miners Revenue 7-day Average” chart that shows how much revenue bitcoin miners are generating.
He adds three horizontal lines that mark the previous tops in late 2011, 2013, and 2017.
His analysis seems to the point that once the miners' revenue reached its prior top, it soon began another rally towards a brand new top.
Could this mean the bitcoin bull run is just starting?
The next tweet comes from Christopher Gimmer, whose Twitter profile describes him as a bitcoin entrepreneur and investor.
In his post, Gimmer shared a chart of bitcoin’s price since March 2020. As Gimmer wrote,
“Bitcoin’s 50% drop last March is now just a blip on a 1 year chart.”
Essentially, if you are in bitcoin for the long-term, your investment efforts have a higher probability of yielding satisfying returns. Historically, with a few exceptions, bitcoin outperforms the previous years; hence it makes sense to buy and hodl bitcoin for long periods.
The last post of the day comes from Vetle Lunde, an analyst at Arcane Research.
In his tweet, Lunde discusses the most bullish news of the day, in our opinion.
“Aker just became the first major company in Scandinavia to allocate capital to bitcoin. The company has invested 500 million NOK (~$60m) to purchase 1170 BTC (avg purchase price ~$51 290).”
We think this proves just how much interest there is by wealthy corporations and individuals to acquire bitcoin.We feel that as more companies that acquire bitcoin, the more likely the price will rise.
As we’ve discussed previously in the “Daily Roundup,” the less bitcoin is available at the market, the higher the likelihood its price will grow (Law of Supply and Demand).
Bitcoin Price Prediction
During the weekend, bitcoin's price found strong support above $48,500, and yesterday it had a magnificent bounce that pushed up the price over 7%. At the time of this writing, bitcoin's price was trading close to $50,000.
Due to the cryptocurrency trading within the predicted range, we think the chances for bitcoin's price to reach $60,000 are increasing. However, we should expect a massive amount of new buyers to reach the bitcoin space within the next few days.
We're hopeful that the bullish trend will ensue, but we're also aware that there is a chance for a sudden pullback if sellers suddenly take control.
How do we think the price will trade today and throughout the week? As shown in the above chart, we believe that bitcoin could top around $55,000 in the next few days, assuming buyers continue to enter the space.
On the other hand, we don't expect the cryptocurrency to drop much below $47,000. If it falls, then $45,000 will most likely be the next healthy level of support for bitcoin's price.
To finalize, the Volume Profile Visible Range (VPVR) shows a high number of buy orders between $47,000 and $48,000, which means BTC/USD should not go much below this range even if the trend suddenly reverses - something we don't think will happen anytime soon.
Pay attention to sudden price swings, as bitcoin's price still needs to reach its prior high to make us confident on a full continuation of the bull run. Conversely, if it breaks its current support around $50,000, that would be quite bearish for BTC/USD's foreseeable future.