For the first time since July 2018, Bitcoin (BTC) is on track to record its first green monthly candle, recording a positive month,
According to cryptocurrency trader Josh Rager, if the Bitcoin price remains above the $3,414 mark by the end of February, BTC will establish a green monthly candle.
“Bitcoin is working on its first green monthly candle since July 2018. The past 6 months Bitcoin has seen red on monthly, a break and close below $3413 will continue the red monthly trend,” the trader said.
In the past two months, since establishing a 12-month low at $3,122, Bitcoin has recovered by 15 percent to $3,592.
Can Bitcoin Successfully Test Key Resistance Levels?
Bitcoin would only be able to achieve a positive month in February if it hovers above the mid-$3,000 region by the month’s end.
Since January 11, BTC has remained in a tight low range between $3,300 and $3,700, unable to initiate any large price movement below or above important support and resistance levels.
The forecast of the near-term price trend of BTC widely varies depending on the time frame used by analysts.
Generally, researchers expect BTC to begin recovering by the latter half of 2019 when both fundamental and technical indicators are expected to point toward a strong mid-term rally.
Fundamentals in the Bitcoin market include the on-chain transaction volume of the asset, institutional activity, and growing infrastructure supporting the asset class.
Regarding the short-term trend of crypto assets, the sentiment on the movement of the cryptocurrency market leans bearish.
Mark Dow, a former Internal Monetary Fund (IMF) economist, said that unless BTC breaks out of key resistance levels at $5,000 and $6,000, it is vulnerable to a bloodbath in the low price range.
“Still a beautiful chart. If bitcoin can’t bounce to at least $5k – $6k soon, it’s a really bad sign for the cyberbulls. And if it breaks down thru the yellow line at any point, even the HODLers need to GTFO,” Dow said.
If Bitcoin achieves its first green monthly candle in the next two weeks, it could ease pressure on the cryptocurrency market and potentially encourage a movement that may test crucial resistance levels.
In an alternative scenario, BTC could hold the $3,500 to $3,700 range for several more weeks, continuously showing a lack of volatility and strength.
In that case, as a cryptocurrency trader with an online alias “Hsaka” said, a downside movement is more likely.
The trader explained:
Haven’t the slightest as to which way this expands. A right proper stalemate as of now, wicks on both sides without any follow through of either. If I was hard-pressed, I’d say I’m leaning towards more downside.
BTC is at a Stalemate But Alternative Cryptocurrencies Seeing Momentum
While the dominant cryptocurrency has been unable to engage in large price movements, alternative crypto assets and ERC20 tokens have recorded large gains against both BTC and the USD in the past week.
Historically, tokens have tended to record upside movements when BTC and major cryptocurrencies experience long-lasting sideways movements.
Binance Coin (BNB), for instance, has recorded a 52 percent increase in price from $6 to $9.16 in less than two weeks following reports on the strong financials of Binance.
On February 14, Binance chief financial officer Wei Zhou told CNBC that the exchange is still profitable after the 85 percent decline in the valuation of the crypto market.
The company reportedly generated nearly half a billion dollars in yearly profit last year. But, the exchange does not release its financials to the public.
Previously, Binance CEO Changpeng Zhao projected a yearly profit in the range of $500 million to $1 billion in 2018 and the exchange is believed to have met that figure.
Last modified: March 4, 2021 2:53 PM