Bitcoin Expects to Reach $65,000 Next Month, Fractal Analyst Claims

Feb 17, 2021 | Bitcoinist News | 0 comments

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Bitcoin’s run-up to its all-time high above $50,000 this week has prompted a data analysis firm to predict further upside valuations for the cryptocurrency.

TradingShot, an independent trading management firm, wrote in its latest note to followers that it sees the BTC/USD exchange rate at $65,000 by next month. And, if the trend persists, the pair could extend its upside move to as high as $70,000 within the same timeframe.

At the core of TradingShot’s analysis lies a technical fractal—a so-called Fibonacci Channel that was instrumental in predicting the Bitcoin price patterns last year. The firm applied the same forecasting model to determine the cryptocurrency’s next potential move, coming with analogies that appeared overly bullish.

That Bullish Bitcoin Fractal

Of late, Bitcoin tends to move inside the Fibonacci Channel’s ranges that act as supports and resistances. At TradingShot’s discretion, these ranges are drawn using the following lines: 0, 0.382, 0.5, 0.618, 1.0, 1.382, 1.5, 1.618, and 2.0—all running parallel with each other to the upside.

Bitcoin, cryptocurrency, BTCUSD, BTCUSDT

Bitcoin eyes a run-up towards $65,000 based on Fibonacci fractals. Source: BTCUSD on TradingView.com

The Fibonacci Channel structure showed Bitcoin closing a weekly candle above the 1.618 extension line, pointing at two potential scenarios. The first scenario discussed the prospects of an extended rally towards the next extension line at 2.0. Meanwhile, the second focused on a correction lower towards the 1.618 – 1.382 zone.

That 2.0 Fib extension sits near $70,000. On the other hand, the 1.618-1.382 zone roughly represents the area between $50,000 and $35,000. TradingShot added that even a downside retracement would allow traders to buy the Bitcoin dip, based on a similar sentimental behavior following a bearish move in December last year.

“Right now, the model suggests that since BTC/USD closed one 1W candle above the 1.618-Fibonacci extension, it will move forward to test the 2.0 Fib ext,” wrote TradingShot.

“The reason is the historical price action itself. When the 0.618 gets rejected, but the price remains supported within the 0.382-0.618 zone (no candle closings outside), it rebounds to the next 1.0 interval (blue arrow),” the firm added.

But Who’s Buying?

Bitcoin’s latest price boom above $50,000 appeared after a flurry of encouraging news from Wall Street.

In February alone, Tesla revealed that it now holds $1.5bn worth of Bitcoin in its balance sheet. Meanwhile, Nasdaq-listed software intelligence firm MicroStrategy increased its Bitcoin reserves to 71,079 BTC after buying $10 million worth of additional tokens.

According to a press release published on Tuesday, MicroStrategy now plans to raise an additional $600 million from convertible senior notes to buy more bitcoins. The announcement became instrumental in pushing the BTC/USD rate above $50,000.

Many analysts expect the Bitcoin euphoria to continue higher as long as investors and corporates have an appetite for riskier assets against a depreciating US dollar and poor bond yield returns. That could allow the benchmark cryptocurrency to match the technically-driven bullish expectations as put forth by TradingShot analysts.

News Source from Bitcoinist.com

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