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Bitcoin price turns bullish on Square’s $50M BTC purchase: Is $11K next?

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The number of Institutional investors stepping in to Bitcoin continues to increase and this appears to be inspiring some newfound confidence in Bitcoin price. Just today Square announced that it had purchased 4,709 Bitcoin (BTC) for $50 million.

Square is not the only large company to take this action. Recently, MicroStrategy made waves for also announcing a significant purchase of Bitcoin.

These news events could be a signal to investors that a new cycle is starting up and bigger parties are showing significant interest in Bitcoin. However, will this also affect the short term as Bitcoin is still hovering beneath the crucial $11,000 resistance?

Volatility is at its lowest point since the halving

Bitcoin volatility 7-day index. Source: TradingView

Bitcoin volatility is showing signals of boredom, as the metric is back to levels seen in July. That was the period after the halving, which caused a lot of sideways action in Bitcoin price for weeks.

However, as bullish news enters the markets, some short term hype can be established in Bitcoin price action. A breakout out of the currenty triangle would be bullish for Bitcoin, but investors should be cautious.

The crucial break is the $11,000 resistance

BTC/USDT 3-hour chart. Source: TradingView

BTC/USDT 3-hour chart. Source: TradingView

As the trendline is holding for Bitcoin, a breakout to the upside occurred. This caused the price of Bitcoin to break through the crucial triangle; however, that’s not the most crucial pivot to watch for.

Investors should watch to see whether the previous support area between $11,100-$11,300 can break. If that area breaks and flips for support, further upwards momentum is warranted.

Such a breakout would cause altcoins to show strength as well, as they’ve been hammered heavily in the previous weeks. The best climate for altcoins is an upward moving Bitcoin as this gives investors a calm market environment to trade altcoins.

A significant indicator of altcoins is Ethereum (ETH), which is currently resting on a significant support level.

ETH/USD 1-week chart. Source: TradingView

ETH/USD 1-week chart. Source: TradingView

The Ether chart shows signals of a potential bottom construction, but the crucial green area has to hold for further momentum.

If the $290-$320 area breaks for support, a further downward crash is likely to go to the 200-Week Moving Average which currently resides near $220.

However, if the price of Ether sustains support around the $290-$320 area, a potential range-bound construction between $300 and $450 can be established.

That’s a bullish signal, as the price of Ether would then consolidate on a higher level than the previous two years.

A potential scenario for Bitcoin

BTC/USDT 6-hour chart. Source: TradingView

BTC/USDT 6-hour chart. Source: TradingView

The chart might seem like a potential case of ‘price will go up or down’, but it’s surrounded by a few critical levels to watch.

Essentially, if the price of Bitcoin breaks through the $11,100-$11,300 resistance zone, further bullishness can be expected towards $12,000. This makes the $11,100-$11,300 area is a critical zone for continuation.

If this level cannot break and the trendline is lost, a likely retest of $10,000 is on the cards again.

Until then, a dash of short term bullishness is all market participants can expect.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.





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PlanB feeling ‘uneasy’ as 41% of his followers tip $100K BTC won’t happen this year

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PlanB, the brainchild behind the Bitcoin stock-to-flow model, has revealed he is feeling “uneasy” about his renowned price predictions due to the recent downtrend in markets.

The stock-to-flow (S2F) model, which has predicted BTC prices with some degree of accuracy over the past two years, has been called into question by some of his followers in a recent Twitter poll.

The anonymous analyst surveyed his followers on June 21 asking them what price they thought BTC would reach by the end of the year. He used the results to compare them to a similar survey in March when market sentiment was overwhelmingly bullish.

Of the 124,595 respondents to the latest poll, 41% thought that BTC prices would remain below $100K by the end of the year, which would invalidate the S2F model. That’s two and a half times the 16% in the previous poll who thought the lazer eyes crowd would be disappointed this year.

PlanB who originally published the price predictor in March 2019, pinned a message admitting that even he feels a little “uneasy” when BTC prices deviate from the model. However, the analyst noted that the model had managed to hold previously in March 2019, again in March 2020 when the pandemic caused a global market meltdown, and once more in September 2020.

Preston Pysh, the founder of The Investors Podcast Network, commented that it was difficult for a model to account for a blizzard of bad news that has accelerated the market downturn.

“You mean your model doesn’t account for 40%+ of mining rigs getting banned & forced to turn-off & relocate to various parts of the world…and with no forward notice to companies/entitles for the extraordinary expense to their heavily denominated BTC treasuries/retained earnings.”

The model is a calculation of a ratio based on the existing supply of Bitcoin against how much is entering circulation. The scarcer the asset becomes due to the four-year halving cycles the higher the price. PlanB’s model predicts an average price of $288K over the next three years.

Related: $288K BTC price ‘still in play’ says PlanB as Bloomberg champions Bitcoin halving

At the time of writing, Bitcoin had gained 2.9% over the past 24 hours to trade at $34,450 according to CoinGecko. The asset is currently 45% down from its all-time high of $64,800 on April 14.





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Bitcoin in uptrend but BTC may never beat gold’s $10T market cap — ex-NYSE head

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Bitcoin (BTC) is on a “lower left to upper right trend” and its volatility should not scare investors, the former head of the New York Stock Exchange says.

In an interview with CNBC on June 23, Thomas Farley revealed long-term convictions about Bitcoin and dismissed concerns over BTC price losses.

Bitcoin: Going up, but not “up only”

Coming a day after CNBC pundit Jim Cramer admitted that he sold his Bitcoin stash, suggesting that BTC/USD was going as low as $10,000, Farley provided some much-needed mainstream bullishness.

“With respect to the recent price moves, I’m kind of sanguine about them — Bitcoin’s a very volatile asset class, in part because it’s a new asset class,” he told the network.

“I have no doubt it’ll go up, it’ll go down over the long term — I still think it’s a lower left to upper right trend and I think we’re going to see that play out over five years.”

With mining upheaval coming from China still on everyone’s lips, popular mainstream criticism of Bitcoin’s energy usage was also swiftly cast aside as a temporary issue.

“I think this kerfuffle is an interesting conversation, but by and large I think it’ll be resolved because I think the blockchain at its core adds to its efficiency and in fact will add to energy efficiency over time,” he continued.

Less convinced on gold. vs. Bitcoin

When it comes to Bitcoin as “digital gold,” however, Farley was more conservative in his predictions.

Now firmly beneath a trillion-dollar market cap, Bitcoin must transform in order to take on store-of-value safe-havens.

Related: Joining the ranks: Bitcoin’s correlation with gold and stocks is growing

“I think the upper bound for now is gold, which is about a $10 trillion market cap,” he added.

“In order for Bitcoin to one day exceed gold, it’ll have to be more of an accepted form of currency — I’m not sure, frankly, if it ever gets there.”

Proponents argue that Bitcoin, by its very nature, faces just a matter of time before eclipsing gold thanks to the latter’s ultimately infinite supply and inability to beat Bitcoin in all aspects of “money.”

The precious metal saw a major sell-off last week after comments on policy from the United States Federal Reserve.

To beat gold, Bitcoin would need to trade at more than $533,000 with the current supply.