An upward breakout in the bitcoin price may occur as early as this week, experts say.
The strong resistance level of $50K has kept bitcoin from rising for a long time. But Christmas week can change everything. Traditionally, the Christmas rally takes place in the fiat markets. Experts attribute this to the general positive sentiment in the business environment on the eve of the Christmas holidays.
Until now, this has not been the case for the cryptocurrency market. However, this year the situation may change, because institutional investors have entered cryptocurrencies. By the way, bitcoin’s own history may continue to influence its price too. According to popular analyst TechDev, bitcoin still rhymes with previous bull cycle years. Technical indicators point to the same upside potential as in 2020 and 2017.
Popular analyst PlanB is also optimistic. He points out that “bitcoin had in fact just been in an extended consolidation phase for most of the year.” Consolidation is followed by an upside breakout as a rule.
The Fed’s decisions have become another important factor in the possible bull run. An increase in asset repurchases while maintaining the discount rate maximizes the chances of growth for bitcoin and other popular cryptocurrencies. The dollar is not growing, therefore, investors are investing in bitcoin.
If the quantitative easing tapering ends by March, as it follows from the news, then the Fed will have $8.8 trillion in assets on its balance sheet. This is more than double the amount in January 2020 before the pandemic crisis. The availability of “easy money” is declining. According to Arthur Hayes, former CEO of BitMEX, “major changes in QE effectively alter the availability of “easy” money and has knock-on effects for risk assets such as bitcoin”.
An indicator such as the activity of the OTC market (over-the-counter) also speaks in favor of the BTC growth. This is stated by analyst Cole Garner. According to him, the BTC balance on these trading platforms has increased sharply, which indicates an increased activity of buyers. The expert points out:
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Another indicator is the combined volume delta (CVD) for bitcoin whales, which shows the ratio of buyers and sellers. It also indicates the high interest of buyers. Cole Garner concludes: I think BTC is ready.