Bitcoin is About to Make a Move Towards $10K; Analyst Explains Why
- Bitcoin’s recent jump above $9,500 has increased its probability of testing $10,000 in the coming sessions, according to an analyst.
- He also noted that traders would first target $9,785 as their interim resistance level.
Bitcoin leaped over the $9,500-mark on Wednesday and it now eyes extended its bullish momentum into the six-figure region.
The benchmark cryptocurrency rose 1.89 percent to hit $9,567.77 on Coinbase crypto exchange. The gains came as a part of an upside rally that started this Tuesday. On the day, Bitcoin broke above $9,300 after consolidating sideways in a $150-wide trading range for almost two weeks.
Bitcoin price breaks above $9,500 for the first time in a month. Source: TradingView.com
Traders treated the jump as a breakout move, with some of them expecting that the BTC/USD exchange rate would extend its momentum higher. Ronnie Moss, the founder of Standpoint Research – a crypto-focused investment management firm, even stated that the pair would hit $28,000 by 2021.
An analyst, on the other hand, limited his upside call to $10,000, a level Bitcoin has repeatedly failed to hold as support since February 2020.
A Short-Term Setup
The analyst showed Bitcoin breaking above a Descending Trendline with a top dating back to June 1. So far, the cryptocurrency traded below the downward slope, witnessing a higher selling pressure among traders. Nevertheless, its invalidation allowed the analyst to envision BTC/USD at higher but interim price levels.
“Downtrend broken and looking to flip recent highs of $9.5k into support is bullish for me,” he said this Thursday. “Weary that we are still in an 84 day range and breaking $10k-$10.5k is when I turn full bull.”
But a move into a six-figure range would require more effort from bulls. The analyst stated that BTC/USD still has to cross above a critical technical resistance level at $9,785. It is the same price ceiling that – on June 22 and June 23 – kept BTC/USD from logging a breakout move towards $10,000.
“Next resistance for me is swing highs of $9785,” the analyst confirmed.
The bullish technical outlook drew further inspiration from a supportive macroeconomic outlook. BTC/USD rise this week also came in the wake of an underperforming US bonds market.
In retrospect, real yields on the 10-year US Treasury – adjusted inflation – slipped into the negative area on Wednesday. The plunge came as investors expected the Federal Reserve to continue its monetary policy and keep the benchmark rate near zero.
That lifted the appeal of government bonds to investors seeking higher yields, a sentiment that helped to raise bids in Bitcoin, stocks, silver, and gold markets.
BTC also rose as the United States Office of the Comptroller of the Currency allowed regional banks to offer cryptocurrency custody services to institutional clients.