Bitcoin bulls have had a shaky week of consolidation after the strong upward pressures of recent weeks appear to have hit the buffers. According to some analysts, though, the next significant Bitcoin rally could be on its way. However, the market must continue to stay beyond key threshold indicators.
Omkar Godbole, an analyst at CoinDesk, said traders should look for bitcoin holding above $12,000. Godbole said that would subsequently confirm the return of bullish trends.
“Bitcoin needs to break above stiff resistance at $12,000 to unleash the next phase of the bull market, which began from lows near $4,100 on April 1. The top cryptocurrency by market value is currently trading at $11,527 on Bitstamp, having fallen back from a one-month high of $12,325 yesterday.”
Notably, he pointed to previous examples of bitcoin struggling around the $12,000 mark. This has subsequently emerged as a key indicator in previous rallies.
“This isn’t the first time BTC has failed to hold on to gains above $12,000. The cryptocurrency jumped to a high of $13,880 on June 26 only to fall back below $12,000 on the following day. Similar price action was seen in the following two weeks. Notably, prices rose to $13,200 on July 10, only to fall back below $10,000 the following day.”
A break out beyond $12,060 could clear a path for a rally beyond the previous highs of late 2017. At the time of writing, bitcoin was trading at $11,847. However, given the potential for a further slide in bitcoin prices over the coming days, investors are urged to mindful.
Technical indicators suggest that if bitcoin was to find acceptance somewhere below $11,200 over the next couple of days, this could pave the way for a further drop towards $10,500.
Ultimately, the medium-to-long term trends still continue to suggest upwards momentum. This year, the cryptocurrency has continued to regain the ground lost through the ‘crypto winter’ of 2018.
Furthermore, the year end is traditionally a strong time for bitcoin rallies. It therefore looks likely that any slides would only be temporary, en route to a more pronounced rally towards the end of 2019.