Key takeout
- Bitcoin recently hit a notable high of over $112,000, its first significant peak since late May, before stabilizing during early Thursday trading.
- The cryptocurrency’s prices broke above the upper trendlines of a descending channel on Wednesday, indicating potential for further gains.
- Analytical projections suggest a future target of around $146,400.
- Investors should pay attention to key support levels near $107,000 and $100,000 on Bitcoin charts.
Bitcoin (BTCUSD) reached a significant milestone yesterday, crossing the $112,000 mark for the first time since late May. After this, it seemed to consolidate during early Thursday trading.
In recent months, the cryptocurrency market has seen a boost thanks to a number of companies seeking to enhance their treasury holdings and supportive legislative actions.
Bitcoin has rebounded significantly, climbing nearly 50% since hitting its early April low, with annual returns of about 19%. This is comparable to the performance of major players like NVIDIA (NVDA) and Microsoft (MSFT) in the same timeframe.
Let’s delve deeper into Bitcoin’s technical aspects on the charts and identify some crucial price levels to monitor.
Descending Channel Breakout
On Wednesday, Bitcoin’s prices surpassed the descending channel’s upper trendlines. This breakout opens the door for potential continued upward movement. The relative strength index (RSI) supports this bullish trend, as it has room to grow, allowing the asset to move into a price discovery phase.
That said, it’s important to note that trading volumes on Coinbase, the largest crypto exchange in the U.S., have been declining. This might suggest that larger market participants, specifically institutional investors, are opting to accumulate assets through Spot Bitcoin Exchange-Traded Funds (ETFs) instead of regular exchanges.
We can use technical analysis to project possible upward targets on Bitcoin charts and identify some key levels where cryptocurrencies might find support.
Chart-based upside targets
Investors can establish upward targets for Bitcoin using measurement principles, which analyze price movements on charts to forecast future levels.
The analysis involves calculating the range of cryptocurrency uptrends before the descending channel and adding that distance to the breakout point established on Wednesday. This method suggests a target price of $146,400, indicating a projected increase of 32% from Bitcoin’s current price.
Key support levels to monitor
As Bitcoin retraces, the first important level to watch will be around $107,000. This area lies just below the descending channel’s upper trendlines and could serve as significant support, especially close to the 50-day moving average and the peaks observed in December and January.
If bulls are unable to maintain this crucial level, a retest might lead to support around $100,000. Investors should be on the lookout for entry opportunities in this range, which aligns with various trading activities observed on the chart since November of last year.
Any opinions or analyses shared here are solely for informational purposes. It’s advisable to consult additional resources for comprehensive insights.
As of the date of this article, the author does not possess any of the securities mentioned.
