I see a lot of chart analysis from others posting on this. To be honest, I dont think charts or technical indicators are going to have a whole lot to do with this going forward. This current uptrend is hype and acceptance by business and finance industries that are making it a valid currency. Currencies charts tend to somewhat follow the rules of chart patterns and such but they dont move the same way as stocks do. Currencies are greatly influenced by different factors. I wanted to point out the following ideas/thoughts that I have:
1. Teslas $1.5b purchase - I dont know what price level they purchased at, but there is an estimation its somewhere between 30-44k level. If there is any support anywhere in this thing, it would be in this area where supply was bought up in one large block.
2. Hype - Retail buyers are scooping this up as well, this is where the main volatility will be present. People can freak out and sell off or have a price level in mind where they are pre-determined to sell. My impression by watching the price action is there were a lot of people selling at $50k. When you see it bounce off that price level and fall away several times before breaching it a few times then holding above, this means the sellers at that level have run out. The new buyers might have the mindset to hold long term or a new number in mind be it $60k, 75k, 100k etc. Going forward all the even numbers will likely have some resistance, though none will be quite as strong as the $50k. From the amount of struggle it took to punch through that level, $50k is going to be a resistance level where buyers will be found and will take some work for it to sell through it.
3. Bank of New York Mellon - The oldest bank in the US has announced its embracing bitcoin. I dont know if that will equate to them buying some, but even the factor that they are going to allow bitcoin transactions validates further bitcoins legitimacy. If they decide to purchase bitcoin, there could be a significant spike in price, as of Dec 2020 they reported $428b in assets. Not that they would put every cent they have into it but bitcoins current market cap is $974b. They technically have enough money to buy 1/2 of all of it, which of course wouldnt work because the price would go up as they try to buy it. Thats just one bank though. Think about if every bank in the world bought into it though. With its scarce supply the only thing thats going to happen is price increase. Then stack on government purchases and business all over the world. There is going to be an issue here with supply going forward, which means higher price.
Trendlines, chart patterns and studies I dont think will be reliable because of these reasons and perhaps others that I havent put down on "paper" here yet. BTC is going to ignore all of that. You can certainly chart what has happened but you arent going to reliably predict what will happen if you are looking for a place to short this. Things that do have some reliability though, resistance at price levels where there was a lot of volume transacted. We can only apply these reliably looking back. Sellers will have their price levels in mind to sell, so we can easily predict those to be the whole numbers in 10's or 5's. I'm sure $100k is going to take some time to punch through and hold but it will. The only thing that can stop bitcoin at this point is legislation banning it. The more business that sign on, the less likely that will happen.
I dont normally trade on news, but on this one: News of X Business buying bitcoin or X Bank investing in bitcoin and so on, could cause some pretty significant spikes. If anyone has anything to add or would like to discuss, please do so!
1. Teslas $1.5b purchase - I dont know what price level they purchased at, but there is an estimation its somewhere between 30-44k level. If there is any support anywhere in this thing, it would be in this area where supply was bought up in one large block.
2. Hype - Retail buyers are scooping this up as well, this is where the main volatility will be present. People can freak out and sell off or have a price level in mind where they are pre-determined to sell. My impression by watching the price action is there were a lot of people selling at $50k. When you see it bounce off that price level and fall away several times before breaching it a few times then holding above, this means the sellers at that level have run out. The new buyers might have the mindset to hold long term or a new number in mind be it $60k, 75k, 100k etc. Going forward all the even numbers will likely have some resistance, though none will be quite as strong as the $50k. From the amount of struggle it took to punch through that level, $50k is going to be a resistance level where buyers will be found and will take some work for it to sell through it.
3. Bank of New York Mellon - The oldest bank in the US has announced its embracing bitcoin. I dont know if that will equate to them buying some, but even the factor that they are going to allow bitcoin transactions validates further bitcoins legitimacy. If they decide to purchase bitcoin, there could be a significant spike in price, as of Dec 2020 they reported $428b in assets. Not that they would put every cent they have into it but bitcoins current market cap is $974b. They technically have enough money to buy 1/2 of all of it, which of course wouldnt work because the price would go up as they try to buy it. Thats just one bank though. Think about if every bank in the world bought into it though. With its scarce supply the only thing thats going to happen is price increase. Then stack on government purchases and business all over the world. There is going to be an issue here with supply going forward, which means higher price.
Trendlines, chart patterns and studies I dont think will be reliable because of these reasons and perhaps others that I havent put down on "paper" here yet. BTC is going to ignore all of that. You can certainly chart what has happened but you arent going to reliably predict what will happen if you are looking for a place to short this. Things that do have some reliability though, resistance at price levels where there was a lot of volume transacted. We can only apply these reliably looking back. Sellers will have their price levels in mind to sell, so we can easily predict those to be the whole numbers in 10's or 5's. I'm sure $100k is going to take some time to punch through and hold but it will. The only thing that can stop bitcoin at this point is legislation banning it. The more business that sign on, the less likely that will happen.
I dont normally trade on news, but on this one: News of X Business buying bitcoin or X Bank investing in bitcoin and so on, could cause some pretty significant spikes. If anyone has anything to add or would like to discuss, please do so!