Bitcoin hasn’t done too well over the past few days.
Despite the fact that the block reward halving came to pass just hours ago, the cryptocurrency is actually down since last week’s highs of $10,100, now trading at $8,500. This drop hasn’t stopped optimistic investors from expecting more upside though, with one analyst noting that Bitcoin could be on track to hit $20,000 as the year comes to an end.
Related Reading: Don’t Be Surprised to See Bitcoin Rapidly “Pump” Towards $10,000: Analyst
Bitcoin Is Preparing to Explode Towards $20,000
When Bitcoin’s weekly candle closed on Sunday night, investors were running scared.
After seven weeks of consecutive gains, the cryptocurrency had printed a textbook “Doji” candle, marked by a skinny body and long wicks above and below the candle. Doji candles, according to some traders, are a sign of a trend reversal.
Yet, according to the popular trader that shared the chart below, it may be a precursor for more gains.
He noted that the last time Bitcoin saw seven weeks of consecutive gains, then a Doji was at the start of 2019’s bull rally. What followed the last occurrence of this trend was an 160% increase within the span of three or so months.
This means that should history repeat itself, the cryptocurrency could hit $20,000 as 2020 comes to a close.
Chart from @GalaxyBTC (Twitter handle) that depicts the similarities between Bitcoin’s recent rally and that seen at the start of the 2019 bull run.
This isn’t the only bullish factor that this same trader has looked to in recent weeks.
Per previous reports from NewsBTC, he noted that his custom indicator on Bitcoin’s two-week chart just printed a “buy.”
This was last seen when BTC started to rally from the $6,000s to $14,000, and also seen in late-2017 prior to the 2,000% rally from $1,000 to $20,000. History repeating would see the crypto market rally by hundreds of percent from here.
Chart from @GalaxyBTC (Twitter handle) of Bitcoin’s macro outlook.
On a shorter-term time frame, the analyst noted that Bitcoin’s drop over the past few days actually stopped at three critical levels: a historical resistance, an uptrend that formed at the $3,700 lows, and a liquidity region at $8,000. All this suggests that Bitcoin is primed to reverse back higher.
Not the Only Bullish Factor
It isn’t only these technical factors that suggest Bitcoin will rally towards $20,000 this year.
Speaking to CNBC’s “Fast Money” panel in the wake of the halving, Galaxy Digital chief executive officer Mike Novogratz held his bullish tone on the leading cryptocurrency.
He asserted that with all of the stimulus by governments, along with the record amount of liquidity operations by central banks, Bitcoin could climb towards $20,000 by the end of the year.
Along with the positive macro outlook, Novogratz noted that Paul Tudor Jones, the legendary macro hedge fund investor, entering the Bitcoin space is especially notable.
Novogratz, like other analysts, believes that Jones’ entrance into the cryptocurrency market reduces the barrier to entry for other investors on the fence. This should result in a strong increase in the amount of capital entering the Bitcoin market in the coming months, as one economist tracking the crypto space suggested.
Photo by Nik Shuliahin on Unsplash