Bitcoin bounced back to above $19,000, but the chart shows that BTC and altcoins may consolidate for a few days
Bitcoin has bounced back to above $19,000, with indicators suggesting a period of consolidation for a few days before the next trend move begins.
Bitcoin price hit a record high of $19,892 on December 1. This is a major event as it proved the 2017 massive move was due to fundamentals and not a fluke. When there is price manipulation in traditional markets, it can take many several years for the price to cross the high caused by the manipulation.
An instance that happened in the Japanese stock market, price manipulation caused it to form a record high in 1989 and price has not yet overcome that level. Similarly, Nasdaq peaked during the dot-com price manipulation in 2000 and didn’t break through until 2015. Silver peaked almost $50 an ounce in 1980, and the price didn’t approach that level again until 2011.
After determining that Bitcoin (BTC) is likely not manipulated to the same extent, the next question for traders is: What will be the next high for BTC?
Growing interest from institutional investors suggests that the uptrend may still have some momentum. A recent report shows that the New York Digital Investment Group raised $150 million through two independent cryptocurrency funds with just three investors.
Some analysts have predicted the next target level based on their assumptions and calculations. However, traders should not be confused by high goals, as even a strong uptrend will bring an eventual pullback.
Bitcoin (BTC) hit an all-time high on December 1 and quickly reversed direction, suggesting that profit-taking is at a high level for the meantime. However, the pullback on the day’s candlestick shows that the market remains bullish as the bulls bought the day’s low.
BTC/USD daily chart. Source: Tradingview
Due to both moving averages (MA 50 and MA 20) rising combined with the relative strength index (RSI) remaining in the positive zone, there is strong indication that the bulls will retain the upper hand. Buyers will now attempt to push the price above the $20,000 strong resistance.
If the break above the strong resistance is successful, the movement can see BTC/USD rallying to $22,727 and then to $25,000.
Nevertheless, if the price pulls back from the resistance level of $ 19,500 to $ 20,000, it suggests that the bears are actively selling higher prices. In this case, the BTC/USD can be consolidated for a few days before attempting to resume the trend.