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Bitcoin makes a fresh run at US$45K; other tokens follow

Posted: 9 February 2022 7:30 am
News
BitcoinUp_GettyImages_1800x1000-1

Bitcoin pushed past US$45,000 briefly before dropping off. Staying above that mark could mean that the selling pressure has subsided.

In the latest rally to a key price level, Bitcoin touched above the critical US$45,000 on Tuesday, then pulled back to about US$43,000.

This again put Bitcoin between two technically strong price levels that a lot of investors are watching: US$40,000 and US$45,000. A sustained move above US$45,000 would suggest more gains ahead; dropping below US$40,000 could mean more selling.

How high can Bitcoin go?

For Bitcoin (BTC) price levels around US$45,000, a previously strong support zone, has now turned into a resistance zone. A resistance zone means a ceiling where more investors sell to take profits, or short the cryptocurrency, than are buying. This makes it hard for the price to move higher.

To break a strong resistance level, we need just as strong a catalyst, either in the form of some fundamental change like crypto regulation by the Securities and Exchange Commission (SEC) or renewed buying pressure from whales and retail investors.

If Bitcoin manages to push past US$45,000 and hold, the next resistance level is US$50,000. This zone coincides with the 100 moving average on the daily chart of Bitcoin prices, which acts as another resistance level. A break of these two levels would pave the way for another try at Bitcoin's all-time high at US$68,000.

Bitcoin Graph

Source: StockCharts.com

This doesn't mean it can't pull back

Despite showing signs of bottoming out on the daily chart, the weekly chart shows the downward pressure still stands. In this case, the first support level is US$40,000 which — aside from being a round number — coincides with multiple moving averages converging at the price. This could prove a decent support level from which Bitcoin can bounce off.

This is the point where buyers have recently outnumbered sellers. These points do change, or break.

A break through the US$40,000 level opens up the way for retesting the US$35,000 support level and subsequently US$30,000 as the main support level.

Altcoins follow

In the past few months, altcoins have followed whatever Bitcoin is doing. Bitcoin gained 14% in the past seven days. Ether (ETH), the second cryptocurrency by market cap, gained almost 13%, while Binance Coin (BNB) and Dogecoin (DOGE) gained 11%.

Interested in cryptocurrency? Learn more about the basics with our beginner's guide to Bitcoin, dive deeper by learning about Ethereum and see what blockchain can do with our simple guide to DeFi.

Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade. Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.

Kliment Dukovski owns Bitcoin, Ether and Binance Coin as of the publishing date.

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