Outlook: Bitcoin exploded higher during the week ending December 20th, breaking out above the multi-year resistance level and ATH at $20K to rally to new highs and end the week north of the $23,000 level. This is an exceptionally bullish-looking candle as an impulsive rally through previous resistance in convincing fashion before accelerating higher. Bitcoin found a bit of resistance around the $24K level but is unlikely to find much selling, at least at these levels.
(December 20, 2020 7:30PM EST)
This is a classic breakout pattern and Bitcoin has been slicing up into new price territory never seen before in this asset, decisively jumping up to over $24K for a brief time before pulling back a bit. This area is my first local target for a bit of resistance as it is near the 127.2% Fibonacci extension level and around $25K which is a large, round psychological number. I could just as easily see Bitcoin continuing up this week amid a Santa rally up to $30K before making any meaningful pullback. Simply put, the trend is up, I am not a seller by any means; if anything, I'm looking to buy on dips, which I will be looking for most likely in Q1 as a final "last call" before BTC takes off well into the five-figures and beyond in 2021-2023.
If BTC does find resistance and pull back a bit, I don't see it retreating very far as there's simply too much bullishness and buying pressure to allow price to fall that much lower. Additionally, after having just broken through a long-term resistance level and ATH, that same level should now become a new higher support. That being said, $20K could become our new local support and higher low, or if we're really lucky, a long candle wick down to $18K or so -- but I wouldn't couldn't on it.
Demand is high and only increasing, supply is fixed, limiting, and decreasing, and fiat currencies like the US dollar and Euro are being massively inflated. These three variables provide and extremely bullish macro economic environment for cryptos like BTC, all of which support more buying, less selling, and higher valuations for BTC going forward. I'm bullish, if that's not clear.
Support: I'm looking for $20K to prove a higher low and new support having recently broken above the all-important historic previous level and ATH. Below that, support will most likely be between $16K - $18K, though I think pullbacks in Bitcoin going forward will likely be a little more shallow than they have been in the past, at least for the foreseeable future.
Resistance: I see near-term resistance around the $25,000 level and then $30,000 if Bitcoin pushes up higher from here.
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