BOTS crypto news week 7
The entire crypto market is ecstatic. As a result, a lot of new people are entering the crypto market. Bitcoin is constantly breaking all time highs, Ethereum is at record highs and some alt coins, such as BNB, have gained more than 100% in value over the past week. Just when it seems like everything is fine, it's good to keep you up to date. In this analysis I will address the question of whether these price increases will continue.
By: Steven Eblé
For three weeks in a row, Bitcoin has been on a double-digit rise. With growing institutional confidence in Bitcoin and declining confidence in the US dollar, there is increasing demand for the virtual currency. But how long could the price rise last?
Last week we discussed that Bitcoin was in a rising wedge (purple pattern). A rising wedge is normally a bearish chart pattern. This means that Bitcoin was more likely to break out downwards than upwards. However, Bitcoin broke out of the rising wedge bullish. This was followed by a backtest of the pattern after which Bitcoin rose about 10%. What does this mean for what we can expect?
Last week I indicated that where Bitcoin would exit the rising wedge (at the bottom or at the top) would also determine whether Bitcoin would test the bottom or at the top of the ascending broadening wedge (orange pattern). From the chart below you can see that Bitcoin is already well on its way to the top of the ascending broadening wedge. Bitcoin could still grow about 5% before reaching this.
It seems likely that Bitcoin will test the top of the ascending broadening wedge. This is around 58,500 US dollars, after which a minor correction is likely to follow.
Experience shows that many people are not that interested in short-term fluctuations. Below is Bitcoin shown in a chart on the monthly time interval. Since Bitcoin broke out of this massive ascending traingle in September 2020, the price has risen over 400%. The measured move of this ascending triangle could theoretically take us to 66,000 US dollars in the medium term.
Ethereum has broken through the 2,000 US dollar barrier for the first time in its existence. Still, Bitcoin has been significantly stronger over the past 3 weeks compared to Ethereum. Last week I indicated that the strength was with Bitcoin and not Ethereum. I also wrote that if Bitcoin could break through the 50,000 US dollar barrier it would be plausible for Ethereum to move towards the 2,000 US dollar mark.
Still my opinion is that Bitcoin looks stronger than Ethereum. Once Bitcoin undergoes a minor correction and moves sideways for a few weeks like it did in early February, Ethereum could regain ground against Bitcoin.
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