Bitcoin - the first and most popular cryptocurrency in the world, whose interest continues to grow day by day. While many analysts believe BTC may not become a widespread means of payment for goods and services, it remains the most coveted crypto asset. In this technical analysis by trader Nikita Semov, we will explore what influences the support for the price of Bitcoin. Before taking any actions based on analysis, the user must understand that the trader and the resource are not responsible for the consequences of investment decisions. The provided information is theoretical and for informational purposes only.
VSA and Price Action
To calculate and assess the potential change in the currency's value, it is necessary to monitor the parameter of market fluctuations, specifically the structure of market swings. The JOC (Jump over Creek) pattern is formed based on the price against the backdrop of ascent. The trend cannot break because the structure of the break is directly under the layer, according to Japanese candlestick analysis.
Signals confirming the strength of buyers include growing changes in market structure and the updating of highs. To confirm the partial ineffectiveness of buyers, oversold and BUN statistics are used. The possibility of correction to the $12,450 level is allowed to gather liquidity. Even if the $13,970 mark is reached, resistance and subsequent correction are possible, but not a turning point for the upward trend.
Delta and Horizontal Volume Analysis
To confirm Bitcoin's price overcoming nearby resistance zones (VA and POC), it is sufficient to examine a chart showing confident growth in the course, the formation of additional pushing volumes, and protection. According to statistical data and based on the accumulation-distribution theory, the compression period lasted nine days. Therefore, purchases are expected for another seven days.
Since 2017, the value of Bitcoin continues attempts to overcome the crucial $14,000 level, after which statistical corrections are expected. Balance has already formed on individual localized sections. There is no increase in volumes in the counter-trend or fixing zones, supporting the continuation of the rally.
Key Support Zones for Bitcoin's Price - the lower delta array of buyers in the $12,350-$12,500 segment, as well as the level of $12,700-$12,750 with significant volume. According to the delta accumulation dynamics over a day, active selling pressure is noted. To form a balance, the possibility of a shakeout in both directions is allowed. First, the lower band is collected to gather shorts, and then liquidity is taken to test the volume of buyers.
If liquidity accumulation indicates a decrease, this is a "signal" of an approaching expansion of boundaries, which can be expected within the next few days.
Bitcoin Price Dynamics for 2021
Being the world's most valuable digital gold, Bitcoin continues to excite and stimulate the minds of analysts. Although long-term forecasts are not something new or unusual, the impact of external factors, whether it be an economic downturn or a pandemic, significantly influences the overall financial market picture. The upcoming 2021 promises BTC several possible scenarios:
- Repeating or overcoming the historical price level of $20,000. Favoring future price growth is the unabated popularity of crypto, systematic coin accumulation, and support from global currencies. A negative factor is the influence of major token holders who can shuffle all the cards. According to leading financial experts, for the guarantee of future BTC price growth, the cryptocurrency must finish 2020 with a mark of $12,000.
- The price will fluctuate between $15,000 - $20,000. This is a relatively stable scenario based on the existing economic crisis. Users seek to secure their finances by investing in crypto, which will contribute to stable but not sharp price increases.
- Decline to the $6,000 level. One of the less likely scenarios, going in exchange for potential growth up to $14,000. In this case, everything depends on December 2020 and the price level that the coins will reach by the end of the year. If the cost drops to $10,000 by the end of the year, it is more likely that the price will only fall in 2021.
There are also less popular analyses where the Bitcoin price significantly exceeds its historical maximum. However, making such forecasts in conditions of an unstable global economic situation is practically impossible.
