Bitcoin exploded higher again on Thursday, eclipsing yesterday's new ATH and going on new highs, reaching up to the $24K level before turning around and closing the daily candle around $23K. Bitcoin has broken out in a big way, crushing the previous ATH and is now in uncharted territory, looking higher with the wind in its sails. We're bound to run into some resistance at some point, but we'll have to wait and see where that might be before making any more moves.
(December 17, 2020 7:30PM EST)
My position has been that Bitcoin would probably run up to about the $25K level or maybe $30K before finding any meaningful resistance, which makes sense as they are large, round psychological numbers and a step up from $20K. Now that BTC is well into the 5-figures, it'll probably move in $1,000 - $2,000 increments on a daily basis, sometimes more. That being said, support and resistance levels should be plotted accordingly. I think Bitcoin's not done yet, as it's run into some trouble but is otherwise very bullish. I think the only thing that can really take the wind out of Bitcoin's sails is short-term profit-taking or, a world-shattering network vulnerability, or an equity market crash which would drag crypto down alongside it - the second and third possibilities both being unlikely.
Going forward, we've got a tremendous upward bias with a tidal wave of institutional money inflows coming on board by the day, retail sentiment turning bullish, a diminishing supply, and a massively inflating fiat currency pair. Fundamentally, Bitcoin is a strong buy and hold in the medium-long term. Short-term, you're chasing the trade here. Objectively, it might be best to wait for a pullback and buy value - easier said than done during a strong, record-shattering rally and FOMO surging all around. Patience will be key here - we know the trend of this market - it's convincingly bullish from here on - it's now a matter of adding to your position with a smart entry. We had 3 years to buy between $3,200 and $10,000, now anyone who wants to buy Bitcoin is paying a premium for lower risk.
Support: From here I think $18K should be support as it has a couple of times over the past month, but more importantly will be if this impulsive rally continues on, in which case a pullback to the former resistance level -- $20K -- would step in as a new support level. What a tremendous turn of events. If that's the case, then BTC is ready for another wave higher and puts in a major higher low on the longer-term charts.
Resistance: We're in uncharted waters here, but I think now that BTC is well into the five figures, it'll move in either $2,000 or $5,000 increments. Accordingly, my target is $25,000 which is a nice large, round psychological number, or possibly $30,000. From there, we'll look for exhaustive candles indicating Bitcoin is running out of steam and then look for support levels to target for dips to buy. Bitcoin's going higher - no sense in trying to fight this trend.
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