Bitcoin rallied on Tuesday, breaker above the $35K level as BTC cemented its break of the short-term downtrend which actually appears to potentially be a bull flag, pointing us to higher prices from here.
(February 2, 2021 8:30PM EST)
Outlook:
Bitcoin rallied on Tuesday, firmingly breaking out of the short-term downtrend that has suppressed BTC's price and even breaking out of the descending channel that may actually be the final phase of a bull flag, as shown in the chart above. This is a bullish catalyst that could ignite a bullish wave higher as BTC closed the day above $35K near the highs, indicating that the bottom of this correction very well may be in and we are now starting to press higher out of this sideways trading range. If that's the case, we'll be looking for continuation higher this week and next, as this week could be extremely volatile due to traditional stock market Gamestop volatility, but ultimately we'll be looking for a return to the ~$40K level. If this happens, it may be contested and take a bit of time and effort to re-pierce the $40K level but ultimately, there is simply too much demand and buying pressure pushing BTC higher for it to linger or even drift lower for long.
This week should continue to see extreme volatility as a lot of market levers are being pulled amidst a Main Street Gamestop vs Wall Street Short Fund war in which proxy wars sprout up behind and around them. Gold continues to experience weakness as the US Dollar continues to rally, inspiring correlary weakness in BTC though not enough to stimie BTC much today in the USD charts.
Support: Support at the $30K level which has been tested and seems to have successfully held to date after barely hanging on a few times. If Bitcoin falls below, look for support around $25K, and then $20K -- if we even get there (probably not).
Resistance: Look for resistance at $40K, which we'll probably need to retest a couple of times before heading higher. After that, look for resistance around $50K, then every $10K until $100K. Make no mistake; we're going higher, it's just a matter of when.
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