For the first time on Wednesday, Bitcoin broke through the $110,000 barrier, setting a new record. The groundbreaking event surpasses the cryptocurrency’s previous record, which was set before President Donald Trump’s inauguration in January. This powerful surge reflects a significant upward progression from last month when the cryptocurrency’s value had taken a dip.
Bitcoin’s Journey to a New Record
In recent weeks, Bitcoin’s value has been constantly improving, forming a pattern known as the rising wedge. This is a pattern indicative of a potential reversal if a breakdown occurs. Bars pattern analysis forecasts a bullish price target in the vicinity of $120,000 for Bitcoin. As we observe this impressive surge, it becomes important to keep an eye on crucial support levels on the Bitcoin chart, which are around $107,000, $100,000, and $92,000.
Underlying Factors for the Surge
A contributing factor to Bitcoin’s Tuesday surge was the Senate’s Monday decision to advance a bill establishing a regulatory framework for stablecoins. Additionally, recent comments from JPMorgan Chase CEO Jamie Dimon, expressing plans to allow clients to purchase Bitcoin, contributed to the upward trajectory. Dimon, a longtime crypto skeptic, has clearly had a change of heart, adding a boost to the digital asset’s momentum.
The digital asset has also received a boost recently from growing demand from corporate treasuries. Strategy Micro Systems, which popularized the idea, purchased an additional $765 million worth of Bitcoin last week, taking the value of its cryptocurrency holdings to over $63 billion. Developments such as these indicate that Washington remains committed to the creation of a crypto-friendly regulatory framework and underline the increasing corporate acceptance of digital assets.
Future Predictions for Bitcoin
Bitcoin was recently trading at $110,000, with its highest value for the day having reached $110,700. From an early-April low of around $76,000, the digital currency has increased about 45%. This was largely due to investors being attracted back to the Bitcoin market despite earlier concerns about global trade tensions.
In the future, careful analysis of the technicals on Bitcoin’s chart and identification of crucial price levels will become increasingly important to investors. Observations post this recent surge have revealed a ‘rising wedge’, chart pattern, in the price of Bitcoin. The price has steadily increased since last month after a major drop. Interestingly, this rise has occurred with lower trading volumes, implicating market bigwigs may still be holding back.
Rising Wedge in Focus
Recently, Bitcoin’s price moved towards the upper trendline of the rising wedge pattern, coinciding with a transition into overbought territory by the relative strength index. In a morale boost for Bitcoin bulls, Wednesday saw a golden cross form, as the 50-day moving average moved above the 200-day MA. This chart event suggests a further upside. This calls for technical analysis to project a bullish price target beyond Bitcoin’s record high and identify three significant support levels for future retracements in Bitcoin.
Chart-Based Bullish Price Target
When applying the bars pattern tool, a price target beyond Bitcoin’s record can be projected. This ascent from late April to early May and a repositioning from Sundays low, forecasts a price target of $120,000.
Support Levels Worth Monitoring
The first support level for investors to keep an eye on sits around $107,000. This critical level, if not defended by the bulls, could experience a fall to the psychological $100,000 mark. A more significant price drop may potentially lead Bitcoin to revisit lower support levels around $92,000. This area could provide entry-point opportunities near the two moving average lines.
Investors must remember that the views expressed about Bitcoin are provided purely for informational purposes and that investments in Bitcoin or any other form of cryptocurrency should be made with careful consideration of the volatility involved.
The author of this article does not own any of the securities mentioned.
