The price of bitcoin is more than 30 percent lower than in 2019. But the cryptocurrency sees a strong bullrun in the long-term scenario, says prominent market analyst FlibFlib.
The crypto trader said Wednesday that he believes bitcoin would jump above the highest level of $ 20,000 ever in early 2020. He stated that in the scenario the cryptocurrency wants to consolidate in the short term between a wide range defined by $ 6,500 as support and $ 10,000 as resistance. But given the current active fundamental and technical catalysts, bitcoin would turn the consolidation area upside down, an action that would raise the price above the $ 25,000 level.
Bitcoin could exceed the $ 20,000 Summit in 2020
What will drive Bitcoin up?
FlibFlib came to the bullish conclusion by combining both technical and fundamental factors in the bitcoin market. Basically, the cryptocurrency is likely to rise as a result of halving, an event that would reduce the delivery rate of bitcoins by half. FlibFlib said traders and investors have already digested the scarcity factor. In addition, “extra fiat onramps and media & political attention and a general look of interest” is maintaining the bullish bias of people.
“The combination of accelerated demand / interest / awareness, combined with a limited supply, creates the perfect storm for bitcoin to achieve much higher prices and the ability to reach them fairly quickly,” FlibFlib wrote.
Technically, the analyst recalled the impressive recovery of bitcoin after reaching the bottom of $ 3,100 in December last year. Despite the broader downward correction in July, the cryptocurrency is still 210 percent higher than at the bottom. FlibFlib sees a continuation of the downward pattern, but also believes that there is a strong relapse to the top – according to Fibonacci Retracement measurements.
Investopedia defines Fibonacci Retracement as a set of levels that indicate where possible support and resistance levels. These levels are 23.6%, 38.2%, 50.0%, 61.8% and 78.6%, while 0% and 100% define the start and end of the price cycle, as shown in the graph below.
Example of Fibonacci Retracement Levels: Source: Investopedia
FlibFlib said that bitcoin is likely to retest its 61.8% Fibonacci level – which coincides with $ 7,200 – for a healthy withdrawal. The cryptocurrency, he argued, creates parabolas, breaks off and then goes back to testing the 61.8% parabolic level. fragments:
“We can see that this happened around the 6k level in 2017, with an overwhelming candle on the weekly – we saw this on the way up in 2019 and it is also at the 61.8% retracement level. This is also the 1.18 from the top. I believe that bitcoin will correct in the 7ks. “
FlibFlib also warned of possible “black swan” events that could hinder bitcoin’s bullish sentiment. They include bans in high-profile areas such as the US, Europe or even the entire G8 consortium.
“So to summarize, I believe that bitcoin has the infrastructure, the interest and the fundamentals to go higher, assuming there is no big ban,” he added.