Bitcoin Price, Consistently Posting Record Highs, Approaches $4000
Bitcoin enjoyed large gains over the week, breaking the all-time high numerous times, and peaked at $3934.00 on the Bitstamp exchange during August 12’s trading session. At the time of writing, the price of bitcoin is at $3867.84, up over six percent on the day. The recent price rise also brings the cryptocurrency above the three thousand threshold in British Pound and Euro terms.
It seems that bitcoin is gaining a reputation for being a safe haven asset, with mainstream media noting the negative correlation between bitcoin and global stocks amidst increased tension on the geopolitical stage. With few economic events or data releases, Trump’s actions, or words, were most likely overemphasized in markets over the past week, with the market eagerly looking for any new information.
Bitcoin’s rally is also boosted by the lock-in of SegWit, a scaling proposal and transaction malleability fix. While, on the the other hand, Bitcoin Cash experienced some problems with transaction malleability with exchanges and one of the developers committed to finding a non-SegWit solution to the problem. The hype and hysteria from the split has faded and the dust has settled; the teams will diverge and is healthy for the market, as indicated by the rising price of bitcoin. Moreover, the controversial split has brought greater attention from the general public to the cryptocurrency.
The hourly chart for BTC-USD is shown below, with a fractal resistance at $3934.00 confirmed. The most recent fractal support lies at $3695.17. As outlined by our weekly cryptocurrency market outlook, we suggested a buy position once the bullish saucer signal was triggered, highlighted on the chart below with the yellow ray at $3339.66. The market then went onto reach highs just below $3500, before pulling back to $3178.72 on August 9. The cryptocurrency quickly bounced back, with a bullish Ichimoku breakout on August 10 and by August 11, our initial target at $3622 was reached.
Over the short run, we examine the relation of the market price and the conversion line (blue), an important support at $3814.58 and gauge of short-term equilibrium. An hourly close below this level could point to an extended correction. However, BTC-USD is likely to return to this equilibrium and move higher, with similar behavior shown in preceding trading sessions. Usually, when the conversion line flattens in an uptrend, we should look to enter long positions once the market tests this support. Over the medium term, the Ichimoku cloud shows equilibrium to be around $3659 to $3768 for August 13, with this support zone indicating a good area to set buy limits.
With the Bullish Saucer just triggered this week, as shown below, we expect the upside momentum to remain strong in the weeks ahead. The extreme strength of the bullish momentum is also displayed by the conversion line, which is almost vertical. We expect the next target at $4270.80 to be reached within the next week or two, which is the 161.8 percent Fibonacci extension for the massive upward move from late March to mid-June.
Also, with just three near consecutive record highs posted since the fractal buy level at $1830 in July, bitcoin could keep surging higher until early November, when the next stage of SegWit2x is planned, that is a hard fork to 2MB which is opposed unanimously by Bitcoin Core developers.