• Bitcoin’s price has gained significant bullish momentum and recovered from the drop caused by the FTX fallout.
• It has reached a robust resistance, and if the bulls push the price above it, a mid-term uptrend will become possible.
• Bitcoin has surpassed the wedge’s upper trendline reaching a decisive resistance level with considerable momentum.
The cryptocurrency market has been on an incredible bull run in recent weeks, with Bitcoin (BTC) leading the charge. After a period of sideways trading, BTC made a strong move on December 17th, 2020, breaking through the $20,000 mark and setting a new all-time high. Since then, the digital asset has continued to rally, touching $21,000 before retracing slightly.
At the time of writing, BTC was trading at $20,943. Despite the slight pullback, the overall sentiment in the market remains positive and many investors are expecting the digital asset to soon break through the $21,000 resistance level.
The recent rally has been largely driven by institutional investors, who are increasingly turning to Bitcoin as a safe-haven asset in the face of a weakening U.S. dollar and rising inflation. Moreover, the rollout of several large-scale cryptocurrency infrastructure projects has further boosted investor confidence.
In addition to the institutional interest, retail traders have also been piling into the market. This can be seen in the record trading volumes that have been recorded on several major crypto exchanges.
From a technical perspective, Bitcoin is currently trading in a wedge pattern, with the upper trendline at around $20,800. If the bulls can push the price above this level, a mid-term uptrend could become possible.
The next major resistance level is around the $21,500 mark, which is the previous major pivot. If Bitcoin can successfully break through this level, the demand could return to the market and send the digital asset higher.
On the other hand, if the bulls fail to break through the $21,500 resistance level, the digital asset could enter a period of consolidation. In such a scenario, the price would likely remain range-bound between $18,000 and $21,500.
Overall, the cryptocurrency market appears to be on the cusp of a major breakout. If the bulls can push the price of Bitcoin above the $21,500 mark, a mid-term rally could become possible. On the other hand, if the digital asset fails to break through this level, it could enter a period of consolidation. In either case, investors should keep a close eye on the market and be prepared to act accordingly.