Bitcoin Price Top Forecast: Bitcoin bulls practice cautious optimism
|- Bitcoin stays green, while altcoins paint a mixed picture.
- Fundamental developments have been supportive of Bitcoin this week.
- The short-term price recovery is limited by $11,000.
The cryptocurrency market has been licking wounds and clawing back ground lost during the previous week. The total capitalization of all digital assets in circulation returned towards $289 billion, while Bitcoin managed to restore its dominance to 65.6%.
However, despite the overall growth, top-20 coins paint a mixed picture. Chainlink (LINK),Dash and EOS being the worst-performing coins (-8.3%, -4.5%, -4.3% respectively). Tezos (ZTZ) beat the market with eye-watering 40% of gains on a week-on-week basis. The US-based Coinbase announced the decision to add Tezos to the list of tradable assets. The market often meets the listing news with enthusiasm.
What's going on in the market
This week the market has been watching crypto whales activity and discussing the effects fo global monetary policy on the crypto universe.
Considering that this week featured the meetings of FED and Bank of England, the financial markets were focused on their take on the global economy. FED's decision to slash the policy rate coupled with a dovish stance of the European Central Bank inspired bullish forecasts on Bitcoin and other cryptocurrencies with limited issuance.
Accommodative monetary policy is supposed to inject more liquidity into the economy, devaluing the cost of money. Meanwhile, an innate deflationary feature of Bitcoin implies that it is not affected by external measures and can be used as a hedge against inflation and macroeconomic calamities.
Thus, Tom Lee, a co-founder of Fundstrat Global Advisors, believes that FED's decision to cut rates will push Bitcoin towards $20,000 by the end of the year.
Notable industry developments
LedgerX stirred the market with false Bitcoin futures launch announcement. Considering that this news might have triggered the upside momentum, the market may retreat towards the end of the week, following the denial. Read more on this.
Bitfinex launched new trading services in Europe that will simplify the process of buying and selling cryptocurrencies, Read more on this
South Korean banks tightened approach to cryptocurrency exchanges to comply with the recent FATF guidance. Russia is developing the taxation system for digital assets, despite that the corresponding legislation is still pending.
BTC/USD, 1W chart
Bitcoin has partially recovered the losses of the previous week; however, we still need to see a sustainable move above $11,000 handle for the recovery to gain traction. This barrier is strengthened by the upper line of the 1-day Bollinger Band. Once it is out of the way, the price will return to the previous range. This movement will signal that the long-term upside trend is resumed.
The next strong resistance awaits the bulls on approach to $12,000 and $13,000 (this resistance area is created by an upper boundary of weekly Bollinger Bands). Then comes the highest level of 2019 at $13,862.
On the downside, critical support is created by $10,000 barrier. It used to be stiff resistance; now, it has turned into a strong support area. A sustainable move lower will spoil the short-term technical picture and make the coin vulnerable to further losses.
The next support is created by the lower line of 1-day Bollinger Band on approach to $9,100. Once it is out of the way, the sell-off is likely to gain traction with the next focus on $8,800 (SMA100 (Simple Moving Average) daily). This area will serve as a backstop and attract new buyers to the market.
Considering the upward-looking RSI (Relative Strength Index) on a weekly chart, we may suggest that the chances to resume the bullish trend have improved.
The Forecast Poll of experts improved since the previous week. The expectations on all timeframes are bullish with the majority of experts forecasting Bitcoin's price above $10,000 on weekly and quarterly timeframes. In the longer-term perspective, the price may surpass $11,000.
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