That the price of Bitcoin breaks the 12,000 dollars is important, but do not expect higher prices before 2021
Bitcoin price may now see sideways action for a few months after breaking the crucial multi-year resistance at $ 12,000.
The past week has been a tremendous one for Bitcoin (BTC) investors as the price broke the crucial $ 12,000 barrier, culminating in a surge from $ 11,300 to $ 13,300, a rebound of $ 2,000 in a week.
A new yearly peak was established, while the dollar has also shown weakness. Additionally, several publicly traded companies filed statements regarding Bitcoin allocations instead of the US dollar.
All of these arguments line up for a continuation of the bull market, but what levels to watch out for? Let’s take a closer look at the charts.
The $ 12,000 barrier was crucial for Bitcoin
As Bitcoin’s weekly chart shows, the $ 11,600-12,000 area was a crucial area to break out for any bullish continuation. This resistance zone has been persistent since the start of the bear market in early 2018. For more than thirty months, the price of Bitcoin was unable to break through this resistance zone, until the week before.
The beginning of a bull market is often marked by beautiful support / resistance tests for continuation, also seen at the $ 10,000 level. After this support / resistance test, the bull run continued. The $ 10,000 level was retested and held, marking a new support zone. Since then, the price of Bitcoin has continued to climb, leading to a breakout above the $ 12,000 barrier.
Resistance at $ 11,600 Must Change to Support
Resistances are at $ 13,600-14,000 and $ 16,500-17,000. However, the latter is unlikely to be affected in the coming months as movements within the range appear to be more likely.
Therefore, traders should pay attention to the $ 13,600-14,000 and $ 11,600-12,000 area, as both could become crucial pivots in the coming weeks.
Total Crypto Market Capitalization Enters Key Resistance Zone
The total market capitalization chart for all cryptocurrencies shows a clear resistance zone between $ 395-415 billion. A one-time breakout is unlikely, but that largely depends on the movement of Bitcoin.
Therefore, a retest of the $ 330-340 billion support would be highly probable and would set a healthy build for the start of a new bull market.
If the total market capitalization exceeds $ 395-415 billion, the next resistance zone is between $ 510-525 billion.
A possible scenario for the price of Bitcoin
As discussed earlier in this article, there is a very likely case that Bitcoin price has a correction towards the $ 11,600-12,000 area for some technical level tests.
Therefore, a technical structure of limited range can be determined. The resistance zone is between $ 13,500-14,000 and the support zone is between $ 11,600-12,000.
This limited range build is very healthy to start a new cycle as it is constantly building up to a higher level. Coming out of this sideways range after a few months can see the next big move, which will likely take the price of Bitcoin to $ 17,000 and possibly even a new all-time high.
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