Bitcoin's surge in the past week has made many hearts beat faster. Now, technical indicators suggest that enthusiasts may soon see another important step up.
Given recent price developments, Bitcoin appears to be consolidating before its next jump, which could lead to a drop to $ 12,000 resistance Level from last August. In addition, according to its 14-day Relative Strength Index (RSI), which measures the extent and duration of the price movement, the coin is in the overbought territory.
And another technical ad suggests that Bitcoin could go higher. Based on the trading envelope indicator, which smoothes moving averages to reflect higher and lower limits, the price of the token is below the upper limit of the band, which is usually considered a positive development.
"The $ 10,000 break is very convincing and should push Bitcoin higher," said Matt Maley, chief market strategist at Miller Tabak + Co. But in the near future it is overbought and will have to take a breather, he said. "It might be able to fix this with a sideways correction, but its upside potential is limited in the next week or two."
Bitcoin recovered last week and Over $ 12,000 was traded on Monday, the highest level in about a year. With increased volatility, however, there was a sharp decline shortly after this threshold was exceeded. Some analysts believed that investors saw the rise as an opportunity to take profits.
"The volatility we've seen in recent weeks is just a reminder of what this asset class is capable of," said Craig Erlam, Oanda senior market analyst. "It is still a relatively immature instrument and lightning movements shouldn't surprise us." The important thing, however, is that it broke over $ 10,000 and a weaker dollar could support it, he said. "This could leave it open to further gains and volatility spikes in the coming months."
Bitcoin even fell 3.2% on Tuesday to around $ 11,000. Other major cryptocurrencies also declined, with the Bloomberg Galaxy Crypto Index losing nearly 5%.
– With the support of Kenneth Sexton
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