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Bitcoin Price Analysis: BTC at the Precipice, Overvalued; Will Buyers Overcome $6,000?

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Bitcoin Price Analysis: BTC at the Precipice, Overvalued; Will Buyers Overcome $6,000?

Today’s Bitcoin (BTC) News

Well, the space is littered with skeptics, believers, perma-bulls and pragmatic individuals. Price is the reason for investment and because of the current recovery, analysts and investors can’t stop raving about Bitcoin and how it will rally towards $1 million in the next two decades or so. Topping the perma-bull list is John McAfee. He’s a certified technologist behind a successful Anti-Virus Firm and deep pocketed. Even so, he is laden with controversies and is on the run, seeking refuge in the Caribbean from where he says he regularly talk with Satoshi who is furious for his attempts to out him and thrust him to the damaging limelight.

For sometimes now, John has maintained his stand projecting the most valuable coin to rally towards $250,000 in less than five years and to $1 million in less than a decade. His view is in sync with other analysts who while bullish, project prices to hit new highs, clearing $20,000 of Q4 2017 before hitting $50,000. Of the many, the founder of BitMex, Arthur Hayes expects BTC to hit $50k. But what if prices are peaking at spot levels. What if contrarian theory is about to crash bulls as prices slide back to $3,000 or lower?

BTC/USD Price Analysis

Bitcoin BTCBitcoin (BTC) is up 7.6 percent in the last week. Nonetheless, it is reacting from important resistance levels at around $5,800. Technically, this is a milestone for Bitcoin (BTC) but at the same time, we must note that for Bitcoin to register new highs then it must overcome the $6,000 level, as buyers close above this liquidation zone complete with above average volumes. However, it would be a tall order.

From the weekly chart, BTC is changing hands at above a key resistance trend line marking multi-months highs. Even so, a level higher and from a risk-reward point of view, buyers are struggling to reverse losses of Nov 2018. From what is visible, the consolidation within the bar’s high low indicate that bears are in control unless there is a sharp expansion of prices this month comprehensively nullifying bears of Q4 2018.

Once that happen, then Bitcoin would be in another phase of recovery as this month close as bullish with traders aiming at $8,500 as the next target. Presently, it appears as if prices are stretched following May-5 expansion leading to a close above the upper BB.

Coinciding with that is the reaction at around $5,800 meaning the correction could after all mark the early stages of a bear trend continuation after the completion of a retest. Therefore, risk-averse traders need to be cautious waiting for a conclusive rally above $6,000 before initiating longs. On the flip side, any drop below $5,350 could see BTC test $4,950 as sellers aim at $4,100.


Chart courtesy of Trading View—CoinBase

Disclaimer: Views and opinions expressed are those of the author and aren’t investment advice. Trading of any form involves risk and so do your due diligence before making a trading decision.

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