Where will Bitcoin end up in November?
A classic rally comes as coronavirus uncertainty persists and data reveals key insights about Bitcoin’s support and resistance levels.
The price of Bitcoin (BTC) has returned to $ 57,000 USD as a new week begins after a late surge produced a much better weekly close than many expected.
Offsetting last week’s coronavirus-induced selloff and associated price drop, Bitcoin topped $ 58,000 overnight before consolidating to the upside, still up around 5.7% on the day.
The outlook could contain many surprises: Coronavirus nerves persist, as macro markets suggest ahead of open, and sellers still have a chance to take advantage of bullish optimists leveraged after recent gains.
With everything to play for and the monthly close expected in less than 48 hours, Cointelegraph examines the numbers to see what could shape Bitcoin’s price performance this week.
Bitcoin recovers in record time
Just three days after losing $ 6,000 USD on a single daily candle, BTC’s price action is already back.
On a classic weekend, Bitcoin’s price rose to produce a weekly close at around $ 57,300, avoiding its lowest weekend price in two months.
Since then, earnings have stalled, with $ 57,000 still the focus of attention at the time of writing this Monday.
In a new analysis, popular trader and analyst Rekt Capital noted that the 21-week exponential moving average (EMA) at $ 52,500 USD provided support as a “time-tested bull market indicator.”
“Strong BTC reaction to the 21-week EMA,” he summed up.
Bitcoin (BTC / USD) weekly chart with 21-week EMA
Despite local highs near $ 58,300, Bitcoin has yet to deliver a definitive advance as the main resistance at $ 60,000 remains intact.
All previous attempts to break into this sell zone since its loss as support have ended in a firm rejection.
However, the increase took some by surprise, according to the data, with closings of nearly $ 300 million in the past 24 hours.
Funding rates, which were neutral on Sunday, are also on the rise, indicating a return of optimism about a reliable rally in BTC prices and the risk that comes with it.
“All it took was a daily + 7% candle to dissolve all fears and concerns of a new bear market for BTC,” added Rekt Capital.
Bitcoin, he said, “is progressing favorably” from the monthly close scheduled for Tuesday night.
Coronavirus and a repeat of March 2020
Macro markets expect a turbulent start to the week as the new variant of the coronavirus, Omicron, continues to affect sentiment.
“We really need more answers to determine the impact on growth,” Priya Misra, global director of rates strategy at TD Securities, told Bloomberg on Monday.
“Risk assets value uncertainty.”
The past week was characterized by high volatility across the board as Bitcoin and altcoins followed stocks, the Petroleum and others for flash sale.
Asian markets appear poised to continue the trend at Monday’s open, with declines of 1-2% expected at the time of writing.
With Bitcoin on the rise, any further pull on macro structures could end the new optimism.
The bulls expect the scenario to play out in the same way as in March 2020, when a loss among cryptocurrencies as the coronavirus entered the world stage subsequently triggered a surge that eclipsed previous price levels.
Nonetheless, Bitcoin did not escape unscathed last week, as some familiar faces have lined up to disparage what they claim is in no way an escape from risk.
“Being less risky doesn’t make Bitcoin safe,” Peter Schiff, the Gold Bug, said on Friday, predicting that Bitcoin would eventually become “as risky as any altcoin.”
Bitcoin chart (BTC / USD) 1 hour
$ 50,000 USD echoes the $ 30,000 USD floor
Those concerned about a pullback from current levels need not look too far on the BTC price chart.
According to the latest backlog data from analytics resource Material Scientist, a giant buying wall has now been installed and is expected to keep the market above $ 50,000.
The stakes may be high, as some have said over the weekend that failing to maintain that level would cause them to reconsider their approach to Bitcoin, but given the breadth of support it now seems less likely.
“I don’t know why everyone is so scared,” Material Scientist summarized on Twitter on Sunday.
“This is the largest order from the bottom at 30k.”
Bitcoin heatmap (order book)
Source: Material Scientist / Twitter
If $ 50,000 is therefore the new $ 30,000, that would classify the current pullback from all-time highs as modest relative to others, in particular the nearly 50% drop in May.
Meanwhile, Material Scientist noticed something unusual: the same entity responsible for the support also placed resistance at $ 70,000 USD.
“Basically, an actor has the entire market at their fingertips,” he explained.
“They knew a month in advance how everything was going to turn out.”
$ 70,000 USD is therefore the main point of interest for bulls eager to see a continuation of the bull run before the end of the fourth quarter of 2021.
D-day arrives for three Bitcoin price correlations
The next few weeks will be “very revealing” for Bitcoin as they create or destroy important correlations.
That was the conclusion of popular Twitter analyst TechDev over the weekend when Bitcoin continued to replicate the journey of gold since the 1970s.
The curious, if not strange, similarities between BTC / USD in 2020-21 and XAU / USD fifty years ago have persisted despite some volatility anomalies in Bitcoin price action.
If the trend continues, Bitcoin faces a dramatic surge with a price that can reach $ 280,000 USD. Deadline: mid-February 2022.
“The gold fractal of the 1970s is now precisely aligned and anchored to both local highs and lows,” commented an update on events.
“Only the months of December / January are affected, the model will be valid until February 1”.
BTC / USD chart vs 70s gold
Source: TechDev / Twitter
A concomitant breakdown of each projected phase of Bitcoin’s metamorphosis since September presents this month as off the beaten path. December is expected to see between $ 70,000 and $ 110,000 USD for Bitcoin.
Beyond Gold and these are the Fibonacci sequences that dictate two more correlations facing their moment of truth in the coming weeks.
Both imply the relationship of Bitcoin to its performance in 2017 and so far both remain valid. If one wins over the other, the rate and height of the price gains will change accordingly.
A peak of around $ 150,000 USD could come in mid-December and $ 225,000 USD could appear in mid-February.
“From mid-December to the end of January, with a high of around 230,000, it is still my base case,” wrote TechDev.
Obviously, the first side of this window seems less likely. I don’t care if it’s fair. I’ve seen some compelling work suggesting a peak from mid-December to mid-March, with targets of 120,000 to 260,000. “
Responding to praise from Global Macro Investor founder Raoul Pal, he added that the next few weeks would be “very revealing” for all three correlations.
Where will Bitcoin end up in “Moonvember”?
It was once the multi-million dollar question on everyone’s lips, but now acceptance is spreading that this bull market may take longer than expected to mature.
Despite this, short-term optimism remains.
In a Twitter poll conducted by the @Bitcoin account that ended on Monday, the majority of the nearly 50,000 respondents predicted that BTC / USD would end November above $ 60,000 USD.
35% opted for the highest possible price during the survey, while 25.7% forecast a November closing price of between 55,000 and 60,000.
Twitter survey results @Bitcoin
Source: Bitcoin / Twitter
Without walking away, it’s easy to forget how far Bitcoin has come in the last twelve months. As Cointelegraph pointed out, last Thanksgiving, which also saw a short sell-off, BTC / USD was trading at just under $ 16,500 USD.
As quantitative analyst Benjamin Cowen summed it up this weekend, “don’t miss the forest for the trees.”
Par William Suberg, Cointelegraph
William Suberg got into Bitcoin while completing his master’s degree and hasn’t looked back since, writing about everything cryptocurrency that makes him sit back and get your attention. He started working with Cointelegraph in October 2013.
The opinions expressed here are solely those of the author and do not necessarily reflect the views of Forex Quebec. Every investment and business move carries risk, you should do your own research when making a decision.
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