Crypto investors are anxiously waiting to see if bitcoin can break through a barrier of resistance this week. CCN has been looking at the case for a new bull market, or an extension of the bear market.
Chief Market Analyst Naeem Aslam at ThinkMarkets UK, believes the 15-month Crypto Winter is coming to an end and the first buds of a bitcoin bull market have begun to emerge. He noted that bitcoin had finally broken through its longest streak of monthly losses and that this was a “strong signal” that the so-called Crypto Winter is over.
Aslam also noted that the bitcoin price has crossed its 200-week moving average, which is a significant technical indicator, and is moving closer to its 50-week moving average. An upside break past this resistance line would be an undeniable sign that the cryptocurrency had entered a bull market, he told CCN, but noted that it may take some months to get there: “Now, if the price kisses the 50-week moving average goodbye and moves above it at that stage, all bets would be in favour of the bulls….[W]hen the price breaks above the 50-week moving average, it sends the strongest bull signal and so far it has worked really well. But this is something that we would have to wait and see. It may take a couple of months for this to happen.”
He also believes that bitcoin could go as high as $400,00: “There is a high chance that the next bull run has a minimum potential of pushing the price 5 times higher. That is over $100K. I personally believe that each Bitcoin can go up as much as $400K and if history repeats itself, this number is not a fool’s paradise.”
Of course, not everyone is as optimistic as Aslam. BitOoda, a crypto broker, “warned clients that bitcoin futures volumes have plummeted throughout March and that unless “large buying volumes” suddenly enter the market, the bitcoin price is unlikely to do anything more than tepidly poke at the $4,200 resistance line,” according to the CCN report.
There is also some concern that traders could find themselves caught in a “false-break out trap,” in which bitcoin tests $4,200 but in low volumes. As CCN says, “Traders would then FOMO-buy into the phantom rally, only to see it dashed and their long positions shattered as BTC careens back toward its “magnet level” at $3,600.”