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Date:
19th Jan 2021
Author:
CryptoAltum Research Team

Bitcoin Bull Trend Depends on a Breakout above $40k

A team of JP Morgan strategists, including Nikolaos Panigirtzoglou, are convinced BTC price breaking above $40k is key. For now, the Bitcoin price remains in range versus an equally revived greenback. Even as institutional demand for the digital asset grows and its relevance as a hedge, competing with gold, increases, bulls must break above $40k if the H1 January 2021 trend is to continue.


Details: 

The Bitcoin price is on an uptrend. However, for buyers to be in charge, a break above the current consolidation (accumulation) is paramount. Ideally, this would attract more capital to the digital asset and perhaps even double the number of funds flowing from institutions via regulated vehicles like Grayscale Investment. Many family offices and SEC-regulated institutions have expressed interest in BTC, explaining their skew, saying that BTC's returns are high and the coin has evolved into a hedge against the USD. Technically, buyers have a chance to keep pressing higher as long as prices are maintained above $30k. However, this depends on if institutions—including channels like PayPal, will continue to pump over $100 million per day into the asset class.


Impact on the BTC Price: 

Neutral. How BTC prices turn from now on depends on the breakout direction. Gains above $40k would trigger institutional FOMO as more will be convinced, subsequently pouring in funds targeting $50k or better. This is not discounting bears who may force prices below $30k to $20k, cooling off the "hot" crypto scene that has outperformed, exceeding analysts' expectations.


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