Bitcoin at the start of a new rally?
After the “digital gold” has reached a new high on various stock exchanges, bullish analysts are outdoing each other with forecasts reminiscent of the assessments of John McAfee. More and more experts consider a six-digit BTC price in 2021 to be realistic. Hardly any other asset was able to perform as well during the ongoing Covid19 pandemic as the leading crypto currency. Already next year, S&P Dow Jones Indices could launch crypto currencies on Wall Street and in terms of mass adaptation, the market entry of PayPal could turn out to be a groundbreaking event. We take a look at the current situation and the possible development in 2021.
At the time of writing, the first mover is trading at 19159 USD, which represents a daily gain of 0.38%. This confirms the suspicions that the bulls find preliminary support at the USD 19000 mark. The small consolidation phase is underlined on Sunday by a falling trading volume. However, this sideways movement could soon turn out to be the famous “calm before the storm”.
Resistance and Support
If the bulls can confirm the trend line at $19000 as a base, the next resistance ranges are at $1,400 and $1,700 before the $20,000 mark piles up. On the downside, the BTC has reached a low of $18178 USD this week. Previously, failed attacks by the bulls were punished with violent ricochets, a by-product of the high volatility.
After severe teething troubles, 2020 could end with a happy ending for Bitcoin, setting the course for a long-term bull rally. The third halving event has brought the inflation rate below 2%. At the same time, the No.1 crypto currency is proving to be a reliable store of value in times of the coronavirus crisis. While more and more experts are talking about a “Gold 2.0”, companies like MicroStrategy are demonstrating their confidence in block chain technology. It is important to remember that a lot has changed since the last bull run in 2018. The days of ICO scams are a thing of the past and countless projects are now delivering real use cases.
Is Bitcoin still the most important crypto currency?
A BTC Dominance Index of 62.6% shows the current distribution of market shares. Despite the successful launch of the ETH 2.0 Beacon Chain, Bitcoin defends its dominance in the limelight. Whether there will be an Altcoin Season next year remains questionable and depends on the performance of Bitcoin. Risk-averse users look for stability and trust. Price fluctuations in the double-digit percentage range have the opposite effect…