Since it fell to $ 8,180 on Monday, the day of the halving, Bitcoin has come back in force. The return peaked past the key resistance of $ 9,000 on Wednesday, viewed from the right side of the picture below.
The Bitcoin price action from May 8 to today is represented by TradingView.com.
While the move above $ 9,000 pushes BTC above a key technical level, it hasn't met with much resistance in terms of liquidations.
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The reason: since Bitcoin traded at ~ $ 8,800 to $ 8,900 for hours and hours before spending $ 9,000, the short positions had enough time to clear their positions.
The rally stopped, Bitcoin remaining stable just above the breakout level mentioned for hours. Cynics think it is a precursor to a downtrend, but more and more analysts are starting to believe that the BTC is ready to resume a decisive upward trend.
Analysts say Bitcoin is ready to go further from here
A leading trader recently said that Bitcoin had recently printed the exact same trend on the weekly chart as it did at the start of the 2019 recovery: seven weeks of consecutive gains, then a "Doji" candle at the top of the trend .
What followed the latest onset of this trend was an increase of 160% over a period of about three months.
This means that if history repeats itself, the cryptocurrency could reach $ 20,000 by the end of 2020.
@GalaxyBTC graphic (Twitter identifier).
Also bullish, the main cryptocurrency has recently maintained an extremely significant historic upward trend, indicating that it will continue to rise in the coming days.
The fundamentals of Bitcoin are also stronger than ever, NewsBTC reported previously, with blockchain analytics company Glassnode, noting that the measures suggest that BTC is seeing increased adoption. Greater adoption correlates with higher demand and prices.
Prevention of "extreme surrender"
The recovery of Bitcoin from here in the next few days is important because it avoids "extreme surrender".
Matt D’Souza, CEO of Bitcoin Blockware Solutions and director of Crypto Hedge Funds, Note On May 11, investors should expect "extreme surrender" if the BTC trades sideways.
D’Souza said that according to company data, 30% of the network operates at a break-even cost of ~ $ 8,500, exceeding this critical level to keep miners operational.
Digital asset manager Charles Edwards echoes this feeling, writing that according to his analysis, the electrical cost to mine Bitcoin is only "somewhere (about) $ 9,000 today".
By ensuring that Bitcoin comes out of this void where miners are neither profitable nor profitable, mass selling is avoided. After all, a "mining surrender" is believed to have caused BTC to drop from $ 6,000 to $ 3,150 in November and December 2018.
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Where does that lead us now?Given the good chances of lower electricity prices, the cost of electricity is expected to be between $ 9,000 today. These are the best estimates.
This suggests that the average Bitcoin miner is not profitable.
They are losing money to run their businesses.
– Charles Edwards (@caprioleio) May 12, 2020
Photo by Ivy Schexnayder on Unsplash