- Summary:
- The BTCUSD pair breached the $50,000 psychological resistance, but failed to hold on to that level. Is the Bitcoin price rally well and truly over?
MicroStrategy Inc, one of the companies that spurred the recent bull run in Bitcoin with large-scale purchases of the asset, has said it would raise fresh capital via convertible notes to fund further Bitcoin purchases. This move is expected to add to the company’s already hefty Bitcoin portfolio.
This move is coming as Bitcoin prices briefly touched off the much-hyped $50,000 mark in early Tuesday trading. However, the BTCUSD pair was unable to consolidate this move and it is back below the $49,000 mark, having established a new all-time high at $50,602.53.
Bitcoin prices continue to establish higher lows and higher highs, signifying that the uptrend is far from over.
Technical Levels to Watch
With today’s test of 50,000, we can expect bulls to mount another challenge on this psychological resistance. Today’s move was just short of the projected resistance at the 88.6% Fibonacci extension level (50,729.16), tracing from the swing low of 10 December to the swing high of 9 January 2021. However, the higher highs and higher lows appear to be forming an area of consolidation marked by a rising wedge pattern.
Price needs to clear the 50720.16 resistance (and the wedge’s upper border) to invalidate any bearish expectations. This move would open the door towards 53532.53 in the near term.
On the flip side, failure to breach the wedge’s upper border (and by extension 50729.16) could initiate a pullback which puts the wedge’s lower boundary at risk. A breakdown here could lead to price capitulation, testing 44138.76 initially (61.8% Fibonacci extension) and possibly 41237.02. Further downside targets exist at 38162.46 and 35997.70.
BTCUSD Daily Chart
