BTC bulls want to confirm this week’s trend reversal, but analysts warn that Bitcoin price is in a “profit-taking” zone where $45,000 is expected to stand as resistance.
The price action for Bitcoin (BTC) continues to tantalize investors and once again, concerns over the state of the global economy and rising inflation have prompted warnings that the Fed’s upcoming interest rate hikes could do more damage then good to the state of the market.
Data shows that the price of BTC has hovered near the $43,000 support level in trading on Feb. 11 after rallying 20% from the $37,000 leve over the past week.
Here’s a look at what analysts expect next for BTC and the wider cryptocurrency market.
“Expecting a move to $40,000”
Insight into the bullish and bearish scenarios related to Bitcoin price was offered by crypto trader and pseudonymous Twitter analyst ‘Crypto_Ed_NL’, who posted the following chart outlining two possible BTC price trajectories.
Crypto_Ed_NL said,
“Checking my latest chart with the current situation. Nothing changed. Expecting a move towards $40,000. Bullish scenario indicates a bounce to $48,000. Bearish comes in play when we break $40,000.”
A confluence of resistance levels for BTC
Bitcoin now finds itself trading in an increasingly tighter rage at these current levels in large part due to “the sharp $12,000 move off the lows” of Feb. 4, according to a recent report from Delphi Digital, which noted that BTC is now “heading into resistance on multiple timeframes.”
As the price action for BTC heads toward a confluence of daily, weekly and monthly resistance, Delphi Digital analysts suggest that “market participants of all kinds will be looking at this as a potential price ceiling” and that it represents “a logical place to expect profit-taking/risk reduction activity due to the confluence of resistance zones and the speed and magnitude of the move off recent lows.”
As for the key areas to keep an eye on moving forward, Delphi Digital highlighted a significant amount of support for BTC in the $40,000 to $41,000 range with the next level of support below that at $38,500.
When it comes to the possibility of a move higher for BTC, Delphi Digital listed the zone from $46,000 to $48,000 as a heavy resistance area.
The report noted that,
“This is the daily, weekly and monthly supply zones that will likely be a heavy level of resistance. Above this level and we likely see a squeeze towards $50,000.”
On a positive note, Delphi Digital also highlighted the recent uptick in institutional flows over the past couple of weeks “as the market started to stage a comeback.”
According to Delphi Digital, Grayscale is the biggest player in the institutional game with “roughly 65% of Institutional AUM,” but there are signs emerging that sentiment is beginning to shift.
Delphi Digital said,
“Excluding BTC and ETH, Binance Coin (BNB), and BNB-based products, have continued to attract the most AUM, but institutional sentiment is starting to favor alternative names like SOL.”
Bulls could exploit this classic trading pattern
A final bullish perspective for BTC moving forward was offered by crypto analyst and pseudonymous Twitter user ‘IamCryptoWolf’, who posted the following chart outlining one possible Bitcoin price trajectory.
IamCryptoWolf said,
“Everyone calling for $46,000, what if $50K –> $46K –> $60K, printing an inverse head and shoulders?”
The overall cryptocurrency market cap now stands at $1.97 trillion and Bitcoin’s dominance rate is 41.9%.