The BTC quotations are again developing descending dynamics. Currently, buyers are lacking the strength to break through an important resistance level. The next critical support level is 16,200 USD, a breakaway of which will provoke the emergence of a Double Top pattern and further falling of the asset.
However, apart from the decrease, there are bright perspectives for the BTC. First of all, the US government might adopt a new package of stimulation measures sized 916 billion USD. This step might add more load on the falling dollar and push market players to invest more in safe-haven assets (such as Bitcoin and gold). Experts note that currently, the BTC is not an instrument of daily payments, rather, it is a means of storing your savings.
One of the private German banks, Hauck & Aufhäuser, announced that in January 2021, it will launch a crypto investment fund. This will give institutional investors access to digital assets, including Bitcoin, Ethereum, and Stellar. Such a step again confirms that cryptocurrencies enjoy high demand from institutional investors worldwide.
On the other hand, the director-general of PayPal is sure that a high-quality development of the crypto industry is impossible without a close partnership with regulators. The company, in its turn, spent a substantial sum on complying with all normative requirements. Also, note that PayPal became the first company to get a conditional license from the regulator of New York.
On D1, the Bitcoin is testing the fast Moving Average again. The previous test ended in a renewal of the all-time high, hence the current movement can be interpreted as a bearish correction before a new attempt of growth. The key support levels are 16,500 and 16,200 USD. Another signal supporting the growth will be a bounce off the ascending support line on the RSI. A negative signal for the bulls might become a breakaway of the lower border of the ascending channel.
On H4, a Triangle pattern might form. Buyers need to break through 20,000 USD very soon. Note also the RSI: earlier it fell below 30, indicating the end of the descending correction and further development of the bullish impulse. Securing the RSI values above the descending trendline will be a strong signal supporting the breakaway of the all-time high.
By Dmitriy Gurkovskiy, Chief Analyst at RoboForex