Analyst outlines prerequisites for Bitcoin to reach $50,000

The leading RoboForex analyst Dmitry Gurkovsky explains the possible trajectories for Bitcoin’s price movement.

Bitcoin prices have rebounded confidently from the $30,000 level. It is likely a crucial level for buyers now, a break above which would push the asset into a deeper correction.

Yet the cryptocurrency remains popular as a store of value. Large investors are keen to hold current positions and to make new purchases. For example, in January this year about 26,000 BTC were mined, and a single investment fund, Grayscale Holdings, bought more than 40,000 BTC in the same period. This supports the idea that the available supply of the digital asset is running out much faster than new supply is created.

Nevertheless, analysts say there is a lack of institutional investor support for an aggressive move higher.

On the daily chart, BTC/USD is charting another triangle. There is a good chance of a breakout above the triangle’s upper boundary soon, with prices holding above $38,500, after which the final target at $50,000 could come into view.

RSI values have also rebounded from the support line, providing further evidence in favour of continued price growth. A positive sign is also another bounce off the region between the two moving averages, signalling bullish strength.

Perhaps a good catalyst for the next bullish impulse will be a conference featuring Michael Saylor. He will share ideas and insights on large Bitcoin purchases, as he does personally and through his company MicroStrategy.

Saylor has been buying the asset during deep corrections, when retail investors rush to exit. And just yesterday he again tweeted about further purchases by the ‘digital-gold’ company for $10 million at an average price of $33,808 per coin.

An estimated 1,400 companies are expected to attend the conference. Of course, it’s unlikely that all of them will immediately shift some of their funds into Bitcoin, but the overall information environment around the event is sure to ‘heat up’ interest in the cryptocurrency market.

In a recent interview, Elon Musk said he supports Bitcoin, but was a bit late with purchases, which should have been made eight years ago. He also noted the large capitalization of the first cryptocurrency and predicted its soon wider acceptance in the financial environment. At the same time, he does not have a clear view on other digital assets.

On the 4-hour chart, BTC/USD continues to trade within a downtrend channel.

To sustain the rise, a breakout above its upper boundary with prices above $38,000 is required. This would indicate the completion of the descending correction, with near-term targets of $42,000 and $45,000 to be considered.

An additional signal would be a rebound off the RSI support line, which has previously led to substantial price increases.

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