Following yet another record high at the weekend, bitcoin is trading on little bit of back foot. The world’s largest crypto-currency rose to fresh all time highs of $7630. However, the pop was short-lived, and prices soon fell back below the previous record high of $7498. Notable, this was the third time in last week that BYC has failed to hold above $7450, despite having clocked a new high.
So, what’s stopping the bulls from attacking the $8000 mark??
Though the exact cause in unclear, Technical parameters do enlighten the highs registered in its own way.
The struggle at mid pitchfork levels showed indecisive behaviour and did not last for many days. Backed by long term investors and scarcity & demand, Bitcoin prices were lifted to Fresh Highs. The Pitchfork formation for the last couple of weeks shows the current rally has extended towards its intermediate resistance levels. Technical parameter suggests strong rally are followed by some corrective move. In this case, price have been sustaining at higher levels with formation of higher top higher bottom. Thus in return, price is expected to correct itself towards the mid area of pitchfork where 23.6% retracement of the recent upswing resided. The support also confluence of overhead resisting trendline (now acting as support) as additional evident (not shown on the chart but can find it on the previous article: http://www.chartadvise.com/bitcoins-prepared-pullback-healthy-correction/).
Goldman Sachs analyst have predicted that the price of bitcoin could surge as high as $8000 in a note distributed to clients earlier this week based on Elliot wave theory. The statement written to Bloomberg states “This break indicated potential for an impulsive advance, one that could reach at least 7,941. This is the minimum target for a 3rd of 5-waves up and should therefore be a level from which to watch for signs of a consolidation”.
Until the merits of being cautious stands in the mindset of investors, the rally will continue to head higher in fear of whether to buy or not. We expect bitcoin price to scale higher towards $8305 levels in upcoming few weeks after testing the retracement levels at $6510 in the near term.