Bitcoin to $21,000? Bullish signals show enormous upward momentum for BTC
The independent analysis company TradingShot is currently writing in a note that BTC/USD could soon reach $21,000. The upward bias resulted from the coincidence of chart signals, which have been shown to have helped Bitcoin to recover almost twice in the fourth quarter. These same signals see the crypto currency at $21,000.
The bullish setup – and now it’s getting a bit technical – consists of a widening rising wedge, a cyclical relative strength indicator and a flood of double-top patterns that don’t work as intended. As the chart above shows, Bitcoin forms the double top and is waiting for a breakout above it, with a target Bitcoin Method sitting around the upper wedge trend line.
Bitcoin „Bullish Megaphone“ setup as presented by TradingShot. Source: BTCUSD on TradingView.com
Meanwhile, the RSI is also showing signs of growth. What continues to act as a bullish catalyst is a support wave at 4H 200 Moving Average (the orange one in the chart above).
„So why just $21,000,“ asks TradingShot and explains, „This is due to an underlying Fibonacci sequence within the megaphone. As you can see each time BTC touches the top of the megaphone, it is approximately on the 1,000 Fibonacci expansion from the previous high. And this Fibonacci extension is about $21,000 next.“
Bitcoin’s strong base
The prospects of Bitcoin reaching another all-time high are also increasing due to a supportive macroeconomic environment. The crypto currency is experiencing renewed buying interest from both private and institutional investors – especially those seeking alternatives to a declining US dollar and similar fiat-based markets.
In May, billionaire Paul Tudor Jones allocated 1-3 percent of his $22 billion portfolio to Bitcoin Futures. Two months later, MicroStrategy, a Nasdaq-listed software company, bought BTC for $250 million to replace its cash reserves. In October 2020, it invested another $175 million in Bitcoin.
In the same month, Square, a global payments company, revealed that BTC has approximately $50 million worth of BTC in its Treasury. Meanwhile, Square’s main competitor, PayPal, integrated Bitcoin-enabled services into its flagship platform, bringing the crypto-currency to its hundreds of millions of users.
Travis Kling, founder of Ikigai Asset Management, calls the growing institutionalisation of Bitcoin a „traditional rush“ and adds that the crypto currency is „just beginning“.
The Winklevoss twins, who operate a crypto exchange in the United States called Gemini, also estimate that the actual value of Bitcoin is about 25 times higher than the current value:
„Our thesis is that Bitcoin is Gold 2.0 and that it will destroy gold,“ says Tyler Winklevoss. „If it does, it must have a market cap of $9 trillion. So we think that one day Bitcoin could fetch $500,000 per Bitcoin. So with an $18,000 Bitcoin, it’s a hold or, if you don’t have one, a buying opportunity because we think there’s a 25x from here.“