Bitcoin Could Soon Find Resistance
While the crypto industry was hit with a string of bad news, Bitcoin (BTC) has rallied hard over recent days. As of the time of writing this, the leading cryptocurrency is valued at a cool $8,800 per coin, with bulls managing to wrest BTC from the grasps of a correction, which brought the asset to $7,450 last week.
While the bullish trend has obviously resumed, with Bitcoin managing to move dramatically higher (~15%) as analysts called for a drop to $7,000 and even lower, Fundstrat Global Advisors warns that BTC may soon run into resistance. In a recent research note, chartist Robert Sluymer explained that the cryptocurrency could find resistance between $8,800 and $9,000, which is where the rally paused in late-May and the trend reversed.
It wasn’t made clear whether Sluymer expected for BTC to head higher, he did call for those reading to “increase exposure”, maybe meaning that a move past $9,000 may be in order. But as of the time of writing, short-term momentum has slowed as the weekend has forced the market to lull.
Still Bullish on Crypto For The Long Run
Regardless of what happens in the coming days, Fundstrat is sure that a massive rally is on the horizon.
During a recent installment of Yahoo’s “On The Move”, Fundstrat co-founder Thomas Lee suggested that Bitcoin is acting much like “digital gold”, giving investors a chance to hedge their bets against crisis with a revolutionary asset that is digital through scarce. With the macroeconomic stage looking extremely tumultuous and busy at the moment, Bitcoin could see further inflows. Just look at the trade war between China and the U.S., and the protests in Hong Kong as perfect cases in point.
In a tweet, he then stated that more likely than not, “crypto winter is over” due to 13 reasons.
Some of these important reasons include the fact that Bitcoin quickly returned to $8,000 after the $1,700 dump on Bitstamp; the Bitcoin Misery Index passing above 89, a sign only seen in bull markets; a growth in on-chain activity and volumes, which historically have preceded rallies; an explosion in over-the-counter volume, signaling institutional interest; and the fact that Bitcoin’s chart recently saw a bullish “golden cross” pattern” while BTC moved above its 200-day moving average in spectacular fashion.
$10,000 is the Level to Watch
As it stands, Fundstrat doesn’t have any explicit price targets. But, $10,000 is a bit of an exception. In a graphic published recently, the investment advisory firm suggested that the “Fear of Missing Out (FOMO)” is quickly materializing in the cryptocurrency markets, boding well for BTC’s performance in the short to medium term.
It shows that once Bitcoin reaches $10,000, “Level 10” FOMO will grace this market, which last occurred when BTC blipped above $4,500 in late-2017. If history is any guide, the cryptocurrency market will shoot even higher once $10,000 is breached. As Lee wrote on Twitter earlier this month, “[$10,000] will see FOMO from those who gloated about the 90% crash in BTC… and those who saw Bitcoin dead as forever.”
This will purportedly result in a “fast and furious” move to $20,000. And from there, Bitcoin will double in the next five months, reaching $40,000 in a jaw-dropping move.
Title Image Courtesy of Icons8 Team