Off the Leash? Bitcoin Looks North After Breaking $16K
Bitcoin is gaining altitude today, amid a sharp drop in prices of some alternative currencies. Is $18,000 in sight?
Bitcoin is gaining altitude today, amid a sharp drop in prices of some alternative currencies.
Prices on CoinDesk's Bitcoin Price Index jumped 7 percent to an intraday high of $16,181 in the last two hours. The cryptocurrency has appreciated by 10 percent in the last 24 hours, according to data source CoinMarketCap.
Meanwhile, Ripple's XRP token has depreciated by 9 percent in the last 24 hours, having soared to new heights on Jan. 3.
So, bitcoin (BTC) seems to have caught a bid wave at $14,848.10 (07:29 UTC), tracking the weakness in the cross cryptocurrency pairs (ETH/BTC, LTC/BTC, XRP/BTC) – that is, money made from the altcoin rally is likely being channeled back into BTC.
Price chart analysis also suggests BTC could extend the rally to $18,000-$18,600 in the short-run.
The above chart (prices as per Coinbase) shows:
- An inverse head and shoulder breakout. As of writing, BTC is trading well above the neckline hurdle of $15,550, so the bullish breakout is pretty much a done deal. Prices could rise to $18,600 (target as per the measured height method) over the weekend.
- Other factors – including a breach of the falling trendline, a bullish break of the falling wedge, higher lows as represented by the rising trendline – also favor further upside in BTC.
- The relative strength index (RSI) is above 50.00 (in the bullish territory) and rising, indicating scope for a rally in prices.
- BTC could cut through resistance at $16,490 and move towards $18,000–18,600 mark over the weekend.
- Bearish scenario: A failure to hold above the neckline support (former resistance) of $15,500 followed by a break below $14,230 today would open the doors for a drop to sub-$12,500 levels.
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