The During the Asian session this morning, Bitcoin hit a new yearly high of $41,745. The cryptomer completed its seventh consecutive bullish week. If many indicators suggest that Bitcoin is overbought and that the $42,000 level could offer strong resistanceOther signals are also the same as those that preceded bull markets after previous halvings. Given these conflicting indices, the question arises: What next levels should be closely watched in Bitcoin price?
The value of the first cryptocurrency has fluctuated since its launch in 2009, to say the least. With a value of almost zero at its creation (the first recorded transaction was the purchase of two pizzas in Florida for 10,000 BTC in 2010), BTC reached $68,000 at the end of 2021. While many analysts see it at 100,000, Its price has continued to rise for almost two months, certainly boosted by expectations of a Fed rate cut and the impending rate cut SEC Approval of a Bitcoin Spo ETFT. Except for certain analyst data, everything seems to indicate that you should invest in this cryptocurrency. So what is it really?
Constant fluctuations in BTC price
In the last 7 weeks, Bitcoin has risen from $27,000 to almost $42,000, an increase of 55%.
This is what the weekly chart shows Bitcoin is currently reaching a strong long-term resistance zone (represented by the red line). A limit that could serve as a goal for the current phase of promotion. This resistance marks the 0.5 Fibonacci retracement of the downtrend from the all-time high (ATH) to the November 2022 cycle low. Beyond The $42,000 level represents the all-time high seen in January 2021 (represented by the green circle).
As mentioned in previous analyses, Market traders use the Relative Strength Index (RSI) as a momentum indicator to identify overbought or oversold conditions. This usually serves as the basis for developing their strategies. As a reminder, if the RSI is above 50 and the trend is up, you should expect the price to rise. On the other hand, if it is below 50 and the trend is bearish, traders expect the asset to decline.
The Bitcoin’s weekly RSI is rising and is around 81. Furthermore, it has been in an overbought zone for 6 weeks now. The conclusion is clear: the market appears to be increasingly overheated and an impending correction is becoming increasingly likely.
However, In a growing market that is accelerating, the RSI could remain in bullish territory for several weeksas was the case in late 2020 and early 2021. As a reminder, the RSI peaked at 95 when Bitcoin was close to $42,000.
What do analysts say about Bitcoin?
THE Unsurprisingly, crypto analysts who have published on X are divided on BTC's prospects. For @jasonpizzino there is no doubt that the main resistance zone is now at $42,000.
In addition, he compares the current price development with the fractal of the parabolic movement of April 2019. According to him, the level of $ 42,000 will serve as resistance in the long term before the halving in 2024. According to calculations, a halving, as a reminder, is planned for the beginning of April
@TechDev_52 who published an analysis of the Vortex Indicator (VI). For him, Bitcoin is currently in a bullish cycle, peaking in a period of 4 to 10 months.
However, it seems that if this analysis proves correct, the narrative surrounding the halving no longer seems so reliable. The analyst summarizes his position: “While most expect a halving, this is not the case with liquidity.”
What can we expect with BTC price in the coming weeks?
You understand, The reaction to the $42,000 level will be crucial for the future prospects of BTC price. If this area represents strong resistance, a correction can be expected. If on the contrary The cryptocurrency continues its upward trend and breaks the key level of $42,000. The overall market has set the next target at $48,500. The RSI indicator, which has just returned to overbought territory above 70, suggests this possibility.
Derivative cryptos appear to have higher growth potential
While doubts about BTC have not yet been completely dispelled, traders are turning to altcoins, which appear to have clearer growth potential.
The The BTCETF project is an innovation inspired by the original Bitcoin. This token was designed to capitalize on the expected excitement in the crypto space surrounding the upcoming approval of a crypto-based exchange traded fund (ETF) by the Securities and Exchange Commission. An approval that, according to many experts, should take place before the end of January. The project is still in the pre-sales phase, But the nearly $2,500,000 that has already been raised shows the interest it has generated among investors and the crypto community.
Those who want to benefit from the growth prospects of the BTCETF token are recommended to visit the project's official website or participate in the discussions on the X platform and Telegram.
Sources: Tradingview, Beincrypto
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This article does not constitute investment advice in any way. The information provided here should not be used as a basis for financial decisions. Investing in cryptocurrencies involves risks and can result in significant losses. You should only invest what you can afford to lose and do your own research before making any investment decisions.
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