Here’s Why Analysts Aren’t Convinced of Bitcoin’s Rally Just Yet
- Bitcoin and Ethereum have undergone strong rallies over recent weeks since their September lows.
- BTC currently trades for $16,000, far above the $9,800 lows seen in September.
- Other assets have also ripped higher.
- Not everyone is convinced that this rally will continue, though.
- One analyst explained that with the second wave of the pandemic sweeping the world, along with Ethereum and Bitcoin running up against a key resistance level, a drop could follow suit.
Bitcoin’s Rally Might Soon Reverse Due to Macro Factors
Bitcoin and Ethereum have undergone strong rallies over recent weeks since their September lows. BTC currently trades for $15,900 after falling as low as $9,800 during the September drop. Ethereum, on a similar note, now trades at $480 after bottoming at $315.
The bounce has been a decisive win for bulls, allowing both BTC and ETH to secure key support levels.
But now everyone is convinced that Bitcoin continues its ascent from here.
One crypto-asset analyst recently noted that both Bitcoin and Ethereum could be setting up for a retracement after their respective strong rallies.
He explains that with the second wave of the pandemic sweeping the world, along with Ethereum and Bitcoin running up against a key resistance level, a drop could follow suit:
“As euphoria sweeps CT, the pandemic’s second wave is sweeping the world. Will Fed intervention keep everything afloat? Probably. But pandemic + weekly resistance = reduce risk for me. As said, I sold off some spot #Bitcoinat $15750. Today, some $ETH at $472. Also please do not interpret this as selling my bags. I still hold spot $BTC, still hold spot $ETH. All I’m doing is taking some profits during an extremely strong rally. With a new pandemic wave right around the corner and no stimulus in sight, I want some dry powder in case.”
Chart of ETH's price action over the past few years with a macro analysis by crypto trader Chase_NL on Twitter. Source: ETHUSD from TradingView.com
Why Bulls Are Favored Here
Bulls still seem to be favored on a longer-term time horizon, though, as the analyst’s chart seen above shows.
As reported by Bitcoinist, analysts think that Bitcoin is on track to hit $17,000 or even $18,000 due to technical trends:
“I think there’s a decent chance bitcoin breaches $17k and even into $18k in the next 10 days (next weekly candle). We are due for a decent mid timeframe blowoff and chill for a bit and wicking into the ATH cluster just feels so right… The path to $18k or ATH wick seems the path of least resistance. Nobody wants to sell until then and everybody is buying dips. Easiest way to create market balance is to do it quickly then let the market chop around a bit.”
Bitcoin is also being boosted by a number of fundamental news events, such as the news of Paypal supporting cryptocurrency and billionaire Stanley Druckenmiller buying Bitcoin.
Featured Image from Shutterstock Price tags: xbtusd, btcusd, btcusdt Charts from TradingView.com Here's Why Analysts Aren't Convinced of Bitcoin's Rally Just Yet
OhNoCryptocurrency via https://www.ohnocrypto.com/ @Nick Chong, @Khareem Sudlow