The $ 13,000 level is believed to be the main resistance area for Bitcoin in the short to medium term. However, many technical analysts and traders are not convinced that this is the high point for the dominant cryptocurrency.
Bitcoin’s performance for the next week could have a big impact on its performance through the end of the year. Currently, traders expect BTC’s upward momentum to continue for several important reasons.
The monthly price chart of Bitcoin. Source: BTCUSD on TradingView.com
Consolidation in a large area of resistance is not a bearish pattern
When the price of an asset stays slightly below a major resistance level in technical analysis but does not see a large decline, it is recognized as a positive trend.
There aren’t many levels of resistance above $ 13,000 until the all-time high of $ 20,000. BTC’s first attempt at its record high in 2017 was so quick that no clear technical level was left behind. When it crashed, it quickly fell below $ 10,000 in a matter of weeks.
Based on Bitcoin’s short-term trend, pseudonymous trader “Salsa Tekila” said that $ 13,000 doesn’t appear as the top yet. He said:
“I’m still on-site, $ BTC, unsecured. This $ 13,000 consolidation does NOT look like a spike. Calling tops in a bull trend is a costly mistake I won’t succumb to.”
When BTC reached a clear peak historically, there was a rapid decline within a short period of time. However, over the past week, BTC has consolidated between $ 12,900 and $ 13,100 without a major sell-off.
“If it gives you the time to sell ‘the top’,” the trader said it is likely not a good deal.
Another pseudonymous technical analyst named “Benjamin Bluntz” said BTC’s current weekly technical structure remains “phenomenal”.
For the first time since January 2018, Bitcoin’s weekly candle closed above $ 13,000. It has shown a clean breakout in the daily and weekly timeframes with the monthly chart on track to see a breakout.
Until BTC sees a significant drop below key support levels, the technical analyst said the market is not for shorts. He said:
“If you keep it simple here with BTC, the weekly chart looks phenomenal. Now mainly downward trends from the 20 km peak in 2017 and this week at their highs above the important 12.5 k resistance. In my opinion, the sky is the limit now and this market is not for short selling. ”
Institutions could see a similar trend
On Oct. 24, Skew reported that the CME Bitcoin Futures COT report shows institutions are holding record net long positions.
The CME Bitcoin futures COT report. Source: Skew
“Latest COT report on CME # bitcoin futures – Leveraged Funds net record short and institutional net record long! With the market recovery, basic trades are becoming more and more attractive for hedge funds and currently generate a return of over 10%, ”said Skew researcher.