Bitcoin (BTC) is at the end of the line. From this point onwards, it will have to break out of the triangle, be it to the upside or to the downside. The most likely scenario, considering all technical as well as fundamental indicators is that Bitcoin (BTC) will break out to the upside. Price action on the monthly chart also does not support a fall and close of a monthly candle below $6,000 as that would pave the way for a bear market.
The squeeze momentum on the chart above also signals that a trend reversal might be around the corner. During the last few days, discussions of a Bitcoin ETF have intensified and the chances of acceptance of CBOE’s ETF proposal also seem likely. Meanwhile, the Winklevoss twins are also campaigning for a Bitcoin (BTC) ETF. This is a huge development but it may take a few weeks or more, if it is to happen this year. This would coincide with a full-fledged market correction, making most investors confident to reenter the market. Exchange volumes are constantly on the decline and show no sign of hope. Perhaps a Bitcoin ETF could be the catalyst the market needs to pump up prices again.
Institutional investors are not entering the cryptocurrency game just because they think they can get incredible returns on their investment. Of course, that is a big part of it as Wall Street has historically been motivated by greed. The primary reason institutional investors are getting into this game is because they now know without any doubt that cryptocurrencies and blockchain technology is the future. So, where does this leave Bitcoin (BTC)? Why should the number one digital currency in the world be Ripple (XRP) or Ethereum (ETH) or a cryptocurrency issued by the Federal Reserve?
The sole reason people put their money and faith in Bitcoin (BTC) was because they were fed up off centralized currency. They did not like hoarding a piece of paper that would lose its value with every passing day. Furthermore, they did not want anyone telling them what they can or cannot do with their money. If a centralized body like Ripple or even Ethereum controls your money, they can decide to block your transactions or deny you service for whatever reason. Besides, there is a lack of trust in centralized cryptocurrencies to be used a mode of payment or store of value.
Bitcoin (BTC) has always stood out as the one truly decentralized cryptocurrency that is globally accepted and recognized as such. The same cannot be said about most cryptocurrency projects. For instance, a ‘decentralized platform’ like Bancor was recently hacked for millions because it had a centralized switch giving the owner (project cofounder/administrator) special privileges. The hackers exploited those privileges of the ‘decentralized platform’ and got away with millions! This is why Bitcoin (BTC) is the largest cryptocurrency out there and will continue to be indefinitely. There will continue to be a huge rush till the number of BItcoin (BTC) remains below the total supply and its market cap remains below multiple trillions of dollars. A large chunk of the whole forex economy will have to absorb into Bitcoin (BTC) and other cryptocurrencies as people lose faith in governments and financial institutions. When that happens, $6,000 per Bitcoin (BTC) is going to look dirt cheap.