Experts believe Bitcoin will set a new all-time-high price by end of year
BTCs fortnightly gains currently lay at a modest 1.9%, while traders focus on NFTs and layer-1 protocols.
- Bitcoin's price action and relative strength index (RSI) have continued to run counter to one another recently, suggesting potential bearish action in the asset's future.
- BTC has continued to show increasing signs of consolidation around the $48k mark.
- Investment strategist Lyn Alden and Fundstrat CEO Tom Lee believe Bitcoin could easily scale up to the AUD$137k mark by the end of 2021.
For over two weeks running, Bitcoin, the world's largest cryptocurrency by total market capitalisation, has retained strong support around the AUD$68k-69k range. However, over the last 24 hours, the digital currency registered losses of around 0.9%, resulting in the asset currently trading at AUD$65,660.
It is worth highlighting that at a recent symposium, Federal Reserve chairman Jerome Powell was quoted as saying that the Fed is looking to start unwinding its US$120-billion-a-month asset purchasing program, adding that proceedings should start by the end of this year. He added:
"We will be carefully assessing incoming data and the evolving risks. Timing and pace of taper will not be intended to carry a direct signal regarding the timing of interest rate lift-off."
This reduction in asset purchasing seems to have had an immediate positive impact on the market at large, with the S&P 500 hitting all-time highs right after the commencement of Powell's speech. Similarly, even Bitcoin rallied on the heels of this announcement, hitting a local high of AUD$66,300 over the weekend.
Bearish heat incoming?
As per technical indicators, Bitcoin's daily price action has been moving in a direction counter to its relative strength index (RSI) for over a month. Not only that, even when BTC has made recent rallies, they have more often than not, coincided with lower peaks, suggesting that the flagship crypto's momentum may be plateauing a little.
In fact, some prominent analysts believe that as long as Bitcoin continues to hover under the sub-AUD$68.5k mark, the asset remains susceptible to a drop to the AUD$52k range. That said, BTC's thirty-day gains currently stand at nearly 15%.
As the US dollar continues to weaken and inflationary fears continue to mount, a number of accredited investors have continued to turn to Bitcoin as a long-term store of value. This shift in financial momentum has resulted in a growing list of analysts – such as Lyn Alden and Fundstrat CEO Tom Lee – claiming that the cryptocurrency can still hit US$100k by the end of the year.
Lastly, investment expert and financial analyst, Ryan Clark, noted that BTC has been consolidating under the US$50k zone just like it was before it broke out last December, implying that good things may be in store for the currency in the near term. That said, it will be interesting to see how the coming few weeks play out for the crypto market as a whole.
Disclosure: The author owns a range of cryptocurrencies at the time of writing