After Bitcoin reaches $50,000, its price could retreat to the $48,051 level. This was stated by Yuri Mazur, head of the data analysis department at CEX.IO Broker.
“At the moment, three Fibonacci correction levels can be identified: at $48,051, $41,539 and $31,000. There is also a technical support level of $32,967, built on a four-hour timeframe,” the expert noted.
The alternating waves of growth and correction on the BTC/USD chart point to the resilience of the uptrend.
“Following the news of Tesla’s $1.5 billion investment in Bitcoin, the cryptocurrency reached an all-time high of $48,200. It then corrected to around $44,000 and climbed back to $48,000, continuing a further wave-like rise amid moderate volatility,” notes Yuri Mazur.
This suggests the rally could continue into the second quarter of 2021.
“We cannot yet name a specific figure that would serve as a guide for the Bitcoin price in the mid-term, but we are confident it will be well above $50,000,”
The economic crisis stemming from the COVID-19 pandemic and inflationary pressure from extensive government support measures by developed-country governments has increased investors’ demand for alternative safe-haven assets, the expert argues.
“MicroStrategy became a pioneer in large-scale bitcoin investments in the corporate sphere. Following suit were Square and Mode Global Holdings. Institutional investors also joined the trend: bank Jefferies, investment funds ARK Invest and Kinetics Portfolios Trust, and insurance company MassMutual.”
Demand for Bitcoin from major corporate players has provided strong support to the price of the leading cryptocurrency and is likely to continue doing so in the long run.
“The main technical factor is the upward trend that has gained significant momentum. As a result, corporate and institutional demand for Bitcoin, along with the upward trend, produced a synergistic effect that yielded such market results for Bitcoin’s price,” says Yuri Mazur.
Earlier, analysts at the cryptocurrency derivatives exchange Deribit stated that institutional investors do not expect a sharp correction after the rise to $50,000.
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