The price of Bitcoin (BTC) is undoubtedly having an impressive year after dropping to $ 3,700 in March and then rising to $ 14,000 in the following months. Now, BTC has hit its highest level since January 2018, with the price hitting $ 14,100.
Thus, the likelihood of a new bull cycle increases sharply as the price of Bitcoin continues to hit new highs and higher lows. Moreover, the strength is even seen as the US dollar currency index, with which it is usually inversely correlated, is also recovering amid coronavirus fears.
Bitcoin has yet to cross the $ 13,700-14,250 zone
1 week BTC / USD chart. Source: TradingView
The weekly chart shows some crucial levels to watch in order to continue the bullish momentum. One of them is the current resistance zone surrounding the $ 14,000 threshold. Crossing this resistance zone would initiate a new force towards the next threshold around $ 16,500-17,000.
These two levels are the last hurdles before a possible new all-time high, as the majority of altcoins still suffer huge losses from their 2017 highs.
There are two crucial levels to watch on the downside. The first and main breaker is the $ 11,400-11,800 area. This has been the crucial area of resistance for two years, meaning it could see a new test before any further improvement.
However, if that area is lost, the next support area is between $ 10,100 and $ 10,400. These two areas are essential to hold if the market is in bullish territory.
Highest Monthly Close Ever Possible For Bitcoin
1 month BTC / USD chart. Source: TradingView
As the monthly chart shows, the highest monthly close ever is possible for Bitcoin – an incredible achievement 12 years after the white paper was released.
However, it also shows the importance of this resistance zone as it is the last major obstacle before the historic high can be contested.
If $ 13,700-14,200 breaks, pursuit to new all-time highs is almost guaranteed as there aren’t many levels in between.
However, the start of a new bullish cycle is usually accompanied by periods of accumulation, during which previous areas of resistance are retested and confirmed as support. Such a period of accumulation would mean that the price of Bitcoin may correct itself towards $ 11,600 to find sufficient support before a major rise.
Current market behavior comparable to the 2016 cycle
1 Week BTC / USD Chart 2016. Source: TradingView
The 2016 graph shows these accumulation ranges through which a healthy trend has established. Each previous resistance level was retested for confirmation, after which a range was established to accumulate Bitcoin.
After such a beach-related construction, the compression began to build up, eventually leading to a massive break.
Another massive signal is buying quickly during market corrections. These are indicated by long strands when buyers move quickly to buy as the price drops. A similar move can occur if the market corrects in the coming weeks.
Possible scenario for Bitcoin price
1 week BTC / USD scenario table. Source: TradingView
The current area of $ 11,400-11,800 is a critical area of resistance. If the price of Bitcoin falls to break through this resistance zone, a correction will become the likely scenario.
Therefore, Bitcoin’s possible scenario is limited action between $ 11,400 and $ 14,200. Such a lateral construction would be similar to the accumulation period of 2016.
Ether and other altcoins can then appear as Bitcoin completes its correction and enters side-scope construction. It will probably be a few more months before altcoins start to rise.
The views and opinions expressed herein are solely those of author and do not necessarily reflect the views of TBEN. Every investment and trading move involves risk. You need to do your own research when making a decision.