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Bitcoin’s meteoric uptrend over the past several days and weeks has allowed BTC to smash through multiple resistance levels that were previously hampering its price action, and yesterday’s break above $8,000 led to a sense of euphoria amongst the cryptocurrency’s bulls.
Analysts are now noting that Bitcoin could currently be caught within the early stages of the next major bull run, but it is important to note that how it responds to this one key price level could be the single factor that validates or invalidates this incredibly bullish possibility.
Bitcoin Hovers Around Key Support Level as Analysts Watch for Heightened Volatility
At the time of writing, Bitcoin is trading down roughly 1% at its current price of $8,020, which marks a notable decline from its daily highs of just under $8,400 that were set at the peak of the recent rally.
It does appear that in the near-term Bitcoin could be on the verge of breaking below its key support at $8,000, although each slight dip below this level over the past couple of hours has been quickly absorbed by buyers.
HornHairs, a popular cryptocurrency analyst on Twitter, explained in a recent tweet that he is closely watching to see how BTC responds to $8,000 for insight into which direction it will go next, as it could be the determining factor for whether or not this recent rally marks a long-term trend shift.
“May be jumping the gun here but I’m willing to hop back in if we see another solid bounce & recovery at this demand. On the other hand a close back below the range high would make me flip my bias & short a retest. If this does trend higher this will be an entry worth holding,” he explained.
May be jumping the gun here but I'm willing to hop back in if we see another solid bounce & recovery at this demand. On the other hand a close back below the range high would make me flip my bias & short a retest. If this does trend higher this will be an entry worth holding. pic.twitter.com/c1mQOKtV4A
— HornHairs 🌊 (@CryptoHornHairs) January 8, 2020
Holding Above $8,000 Could Confirm Next Major Bull Market
Peter Brandt, a renowned analyst, spoke about Bitcoin in a recent tweet, explaining that it is currently attempting to break above the upper boundary of a multi-year descending channel, but bulls need to continue to maintain their buying pressure in order for this to be confirmed and in order for BTC to enter the early stages of its next bull market.
“Has a new bull market began in #Bitcoin $BTC? 1. Market held support at lower boundary of multi-yr channel 2. Small H&S bottom on daily chart 3. Pending penetration of 6+ mo channel… If enough cryptocultists have been shaken out since Dec ’17, then ‘yes’ If not, then ‘no’,” he said while referencing a chart showing the aforementioned channel.
Has a new bull market began in #Bitcoin $BTC?
1. Market held support at lower boundary of multi-yr channel
2. Small H&S bottom on daily chart
3. Pending penetration of 6+ mo channel
If enough cryptocultists have been shaken out since Dec '17, then "yes"
If not, then "no" pic.twitter.com/vpKQeOKqLI— The Factor Report (@PeterLBrandt) January 8, 2020
The next few hours may shine a light on the validity of this pending channel breakout, as a dip below $8,000 could spark a larger sell-off that puts the crypto firmly back into the middle of this wide trading channel.
Featured image from Shutterstock.
