The Bitcoin Rally: Will It Continue or Face Rejection?
The crypto world is buzzing as bitcoin comes close to its yearly high. Will it experience a rejection or embark on a remarkable price surge towards its all-time high?
After reaching $49,000, many expected a “sell the news” event and a 30% correction for BTC. However, the cryptocurrency had other plans and only corrected by 21%, quickly bouncing back close to the $49,000 mark.
Factors Behind Bitcoin Strength
Various factors contribute to bitcoin’s current strength. Weak global economies and the flow of liquidity back into the financial system favor bitcoin, as individuals and businesses seek a hedge against financial instability and fiat currency depreciation. The Grayscale Spot Bitcoin ETF, which previously saw significant selling pressure, is now attracting heavy daily inflows.
A Potential Negative Scenario
While BTC seems to be in a favorable position, there is a possibility of rejection at the $48,000 resistance level. The presence of a double top pattern further adds to this concern.
The Bullish Case
Zooming in, the overall outlook appears positive. The price is holding above resistance, potentially becoming a support level. Moreover, the 1.618 fibonacci level at $55,600 adds to the bullish sentiment. Additionally, the weekly stochastic RSI has crossed upward, indicating potential bullish price action leading up to the halving.
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