Bullish view
- Buy the BTC/USD pair and set a take-profit at 100,000.
- Add a stop-loss at 90,000.
- Timeline: 1-2 days.
Bearish view
- Sell the BTC/USD pair and set a take-profit at 90,000.
- Add a stop-loss at 100,000.
Bitcoin price continued its strong bull run, reaching its highest point since November 17. The BTC/USD pair rose to a high of 94,420, up by over 17% from its lowest level in November.
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Bitcoin Price Rally Continues
The BTC/USD pair has been in a strong rally in the past few days as the so-called January Effect continues. The January Effect is a situation where financial assets rally in the beginning of the year as investors start investing.
Bitcoin has also benefited from the ongoing demand from American investors. Data shows that these investors have added over $600 million in inflows this year alone.
The BTC/USD pair has also jumped as the US dollar has remained on edge in the past few days. The dollar index, which tracks the performance of the greenback against other currencies, was trading at $98.27, a few points below last week’s high of $98.82.
Bitcoin's rally coincided with the ongoing performance in the stock market as top US indices like the S&P 500 and Dow Jones continued their rally.
Meanwhile, the Fear and Greed Index rose to the neutral point at 42, up from last month's low of 10. Bitcoin and other coins tend to do well when the index is rising. Also, the futures open interest rose by over 2% to over $144 billion, its highest level in two months.
BTC/USD Technical Analysis
The daily timeframe chart shows that the BTC/USD pair has rebounded from a low of 80,517 on November 21 to the current 94,500. Bitcoin has remained above the 50-day Exponential Moving Average (EMA).
Bitcoin is about to flip the Supertrend indicator from red to green. Also, it has moved above the upper side of the bearish pennant pattern, invalidating the bearish outlook.
The BTC/USD pair’s Relative Strength Index (RSI) and the MACD indicators have continued rising, with the latter nearing the zero line.
Therefore, the coin will likely continue rising as investors start buying the dip. If this happens, the next key level to watch will be at 100,000. A move below the support at 90,000 will invalidate the bullish outlook.
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