Bitcoin Price Outlook – Bitcoin Breaks Crucial Level on Thursday

Bitcoin Technical Analysis

Bitcoin rallied in the early hours of Thursday to break above the crucial $110,000 level. Now that we’re above here, we start looking for the next leg higher. A short term pullback would make a certain amount of sense, but there is plenty of support and of course plenty of interest in this market at the moment. So therefore, I think you’ve got a situation where traders are going to continue to look at this through the prism of buying the dip.

The $106,000 level should now be support right along with the crucial $110,000 level. But even if we broke down below there, the $100,000 level steps up at support next. As far as the measured move is concerned, and for lack of clarity, you could take the sideways action that we had for multiple months and extrapolate that $20,000 out and start looking at $130,000 as a potential target. As far as shorting is concerned, I have no interest in doing so because quite frankly, the momentum is obviously with Bitcoin again.

And I think it’s worth noting that the Bitcoin market is changing because it has actually led Wall Street down and then led it back up, which is interesting considering that despite the fact that we had sold off so viciously, Bitcoin actually started rallying well before Wall Street did. So, the fact that it’s an institutional ETF now, essentially, does change its behavior. It’s starting to become like the NASDAQ, as it behaves very much the same way. Keep in mind that there is a massive amount of influence from ETF inflows. This has nothing to do with actual demand in the real world. This is institutions coming in trying to get in front of their shiny new toy.

Now the question becomes where and when does the market decide that there has to be real world adoption? So far, that’s not an issue. I guess it’s only been 15 years, but we’ll have to wait and see. Sooner or later, somebody is going to say, wait a minute, we aren’t using this yet. That’s the biggest risk with Bitcoin, and that’s why it is so volatile, and it’s considered to be something that should be a small part of your portfolio, because as we’ve seen in the past, you can lose 25 % in just a few weeks. That being said, it can also rise 25 % in a few weeks. So, it is something that most people want to participate in.

Regardless, momentum is most certainly on the upside here. You can’t fight it. It just doesn’t make any sense. The fundamentals, things like that, don’t really matter in most markets these days. It’s all about where the momentum is, and the momentum’s here. So, I fully anticipate that Bitcoin will test at least 120,000 over the next several weeks, possibly $130,000.

For a look at all of today’s economic events, check out our economic calendar.