Bitcoin: Is $15,000 on the cards or has the rally been cancelled?
Bitcoin's current foray above $10,000 is definitely something different, but is it enough?
In the preceding weeks Bitcoin successfully punched its way to the heavyweight division above $10,000, making it almost to $14,000 before pulling back. By breaking the psychological $10,000 barrier, Bitcoin also ushered in a resurgence of both retail and old-timer interest, which catapulted it up the price charts.
Unfortunately for those who bought at $13,000 (or sold at $10,000), Bitcoin ended up caught in the $11,000 range, where it's been sitting for the last few days. Now everyone without anything better to do is wondering whether they should cut and run or hang on with the expectation of further rises.
One of the points some TA bulls are making is that Bitcoin has been quite comfortable in the $11,000 range so far, and that the current retracement still falls within bullish expectations.
The happy little support line (green) roughly illustrates where Bitcoin kept bouncing back after its drops. The happy little trend line (red) shows one way of interpreting that support line in the context of a continued rise.
If you want to ascribe a whole lot of meaning to that red line, and assume it starts at 10 June for a non-arbitrary reason, it could be construed as indicating that the current price is broadly in line with Bitcoin's upwards movement from about $7,500. In line with that theory, Bitcoin is currently looking very positive.
For a more pessimistic view, you can simply move the lines somewhere else so they slope downwards instead.
It's also worth taking a look back at Bitcoin's previous ventures in this area, especially if you assume that past performance is a guarantee of future returns, which it isn't.
The first time was on 30 November 2017. Bitcoin spent a few days tasting resistance beforehand, but once it broke through $10,000, it went off like a gasoline-fuelled dumpster fire and made it to its all-time high of $20,000 in about two weeks flat. Clearly that hasn't happened again.
But after it started falling again, there were also a couple of points where Bitcoin briefly bounced back through $10,000.
In February-March 2018, Bitcoin made two attempts above $10,000, each of which lasted about two weeks and neither of which lasted long. Both of them peaked out around $11,500. Then in May 2018, it made another couple of attempts, but bounced back short of achieving $10,000.
Now if you look at this rise, the bad news is that Bitcoin clearly isn't out of the woods yet. Two weeks isn't long enough to draw definite conclusions about where it stands. The good news is that Bitcoin is definitely doing something different here by stomping past its old $10,000 obstacle.
It's not yet clear which way it's going to go, but it's 100% certain that Bitcoin's either going to go up or down next, and either way someone's going to be happy that it did, so that's nice.
Disclosure: The author holds BNB and BTC at the time of writing.
- Expert analysis: Bitcoin’s price rally could be linked to potential US Bitcoin ETF approval
- Bitcoin slips below US $30,000 as experts suggest the down trend will continue
- Expert analysis: Despite Ethereum’s latest dip, it can still reach AU $4k in the near term
- Three ways to earn cryptocurrency, that aren’t DeFi
- Bitcoin price analysis: Opportunity as a short term bounce might be on the cards