Bitcoin’s ‘strong breakout’ fractal suggests the price of BTC may reach $ 250,000 to $ 350,000 in 2021

0
0

Bitcoin (BTC) has the potential to push its prices between $ 250,000 and $ 350,000 by the end of 2021, suggests a long-standing fractal.

First of all Point By pseudonymous analyst Bit Harington, the bullish pattern took inspiration from Bitcoin’s age-old bull runs each time after halving when the miner’s block reward is halved. Analysts see the halving as a bullish event, which has reduced the supply of newly mined BTC.

Harington recalled that Bitcoin prices jumped more than 600% after the first two halving events in 2012 and 2016, measured from a line known as resistance / support (R / S), as shown in the graphic below.

Bitcoin price performance after the first two halving events. Source: BuyBitcoinWorldWide, PlanB and Bit Harington

The line represented a barrier during the uptrend price period. Traders tested it several times for a breakout before successfully crossing it to set a new high. When prices started to correct, they eventually bottomed out near the same line.

In 2020-2021, Bitcoin experienced a similar bullish trajectory, rising from less than $ 4,000 to over $ 60,000. Again, Harington pointed to the $ 60,000 level as the same R / S line that kept trades from registering a clear bullish breakout.

The analyst hinted that Bitcoin would surpass this one to soar to a new all-time high price level.

ALSO READ  DOGE Co-Founder Targets Ethereum Bridge, NFTs For Mass Adoption

TBEN Markets analyst Michaël van de Poppe reacted to Harington’s fractal theory, adding that it would drive Bitcoin prices to a range of $ 250,000 to $ 350,000.

He noted, however, that the massive surge could also cause a sharp correction that could push Bitcoin prices back to $ 65,000, just off Harington’s S / R level of $ 60,000.

Are the fundamentals okay?

Bitcoin has skyrocketed after falling below $ 4,000 in March 2020, mainly due to accommodative monetary policies by global central banks to curb the economic consequences of the Covid-19 pandemic. The cryptocurrency closed the year at around $ 30,000, as retail and institutional investors woke up to its safe-haven tale against the falling US dollar and rising inflation fears.

ALSO READ  AMC Theaters Launch Crypto Payments for Electronic Gift Card Purchases

So far in 2021, the price of Bitcoin has passed around $ 65,000 before correcting below $ 50,000. At its year-to-date low (YTD), the pair was trading at $ 29,301 on the Coinbase exchange. Its losses were caused by a sudden ban on all crypto activity in China (including mining) and Elon Musk’s alarming tweets about Bitcoin’s burgeoning carbon footprint.

Bitcoin price performance throughout history. Source: TradingView.com

BTC balance on exchanges drops to new lows

The cryptocurrency has maintained prices above $ 30,000 as its reserves on the exchanges have shrunk significantly.

Blockchain data analysis service CryptoQuant reported that Bitcoin balances on crypto trading platforms fell to around 2.37 million BTC last week, its lowest in over a year.

ALSO READ  Average Australian Crypto Portfolio Grows 258% in FY20-21, Survey Finds
Bitcoin reserves on all exchanges. Source: CryptoQuant

A decrease in Bitcoin’s reserves represents the intention of traders to hold the cryptocurrency instead of exchanging it for altcoins and fiat currencies.

Bitcoin’s hashrate almost recovered

Bitcoin’s recovery from under $ 30,000 to nearly $ 50,000 also coincided with its recovery of V-shaped hashrate.

Related: BTC Price Falls Back To $ 47,000 As Weekly Close Perfectly Tracks Bitcoin Futures Gap

For the uninitiated, the computing power of the Bitcoin network plunged to 84.79 million terahashes per second (TH / s) in early July from 180.66 million TH / s in late May. The drop surfaced as many miners responded to China’s crypto crackdown by shutting down their facilities or moving their operations overseas.

The average seven-day Bitcoin hashrate in recent history. Source: Blockchain.com

But the network recovered more than half of its lost hashrate, reaching TH 136.92million / s on September 18, indicating that China’s direct ban has not had a prolonged effect on China’s mining sector. Bitcoin.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of TBEN.com. Every investment and trading move comes with risk, you should do your own research before making a decision.