After confirming the breakout of $49,000, $BTC is now printing a strong green candle to the upside. Currently at $51,500, the price appears to be unchecked. How long can this parabolic price action continue?
Since $BTC bottomed, after its correction from $49,000, when the Spot Bitcoin ETF approvals were announced, it has gone up more than 33%, or just over $13,000. This was a very short-lived correction, and now $BTC is making up for lost time.
Things look rosy for bitcoin
Behind the scenes things are looking very rosy for the king of the cryptocurrencies. The average inflows for the combined Spot Bitcoin ETFs are around $125 million per day for the last month. And despite the $6 billion in heavy outflows from the Grayscale Bitcoin Trust (GBTC), this has been more than compensated by the $11 billion flowing into the other 10 Spot Bitcoin ETFs.
With all this ETF activity, together with a lot of spot buying from retail investors, many more of whom might have jumped on the bandwagon after $BTC passed $50,000, there doesn’t seem to be a lot holding bitcoin back.
Bitcoin does need a correction
That being said, if this present pump continues for much longer in this parabolic vein, a time of reckoning is bound to arrive at some point. There is quite a strong level of resistance at $51,500, where $BTC is right now, and it could be expected that the price might turn here. If not, then $53,000 to $54,000 is another resistance area to keep an eye on. Of course, if the price just keeps going up it can jeopardise the health of this crypto bull market. Corrections are always necessary, and if we don’t get them, there is the chance of an early blow-off top with a big correction to follow, and the potential for a lower eventual bull market top.
Fibonacci suggests $55,000 next top
Source: Coingecko/Trading View
Bringing the tried and trusted fibonacci levels into the picture, it can be seen that the 1.618 level for this latest move is at a price of just over $55,000. This also matches up with resistance and support levels during the 2021 bull market.
Whatever happens as 2024 unfolds, it is going to be incredibly interesting to witness. The US presidential elections are in the latter part of this year in November. Expect some interest rate cuts leading up to this from the Federal Reserve… and hang on to your hats!
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
