After the recent rapid rally, the Bitcoin price will likely take a breather before rising further towards the end of the year. At least that’s what Chris Thomas, Head of Digital Assets at Swissquote Bank, thinks.
In this regard, the analyst said:
The cryptocurrency could consolidate for a short period of time before continuing to rise until Christmas.
In fact, further notable gains seem unlikely in the short term, as the Bitcoin price has already seen a 60% increase from $ 9,800 to $ 15,900 in the past two months. Both the 14-day and 14-week Relative Strength Indexes are well above 70, indicating overbought conditions and scope for consolidation or a small decline.
Based on Thomas‘ comments, Patrick Heusser, Senior Cryptocurrency Trader at Zurich-based Crypto Broker AG, expects the Bitcoin price to consolidate in the range of $ 14,000 to $ 16,000 in the next few weeks. However, he assumes that the break will enable rally in the altcoins, most of which have lagged behind the Bitcoin price in the past two months.
Bitcoin course could also be heading for a major correction
Others see the whole thing a little less bullish. At least in the short term. Some analysts suspect that the Bitcoin course is heading for more than just consolidation. Joel Kruger, a currency strategist at LMAX Digital, said:
Bitcoin is overbought after breaking critical resistance at $ 14,000, which suggests we may see a period of correction and consolidation.
Historically, the Bitcoin price has seen several setbacks of over 20% in previous bull markets. A big drop is likely this time around, however, as liquidity on the sell side appears to have dried up due to increased institutional ownership and strong HODL sentiment among investors.
Bitcoin price of $ 20,000 this year?
While observers are divided on whether the Bitcoin price will consolidate or fall in the short term, there seems to be a consensus that the long-term outlook for BTC is extremely bullish. Some even expect a retest of the record high of $ 20,000 by the end of December.
Jehan Chu, co-founder and managing partner of Hong Kong-based trading firm Kenetic Capital, investor sentiment has never been better.
We expect short-term volatility alongside even stronger uptrends, flirting with $ 20,000 before the end of the year and, if the stars are favorable, $ 50,000-80,000 by the end of 2021.
Thomas from Swissquote also expects a weaker dollar and political uncertainty in the US, which will play into the hands of the Bitcoin price in the long term.
All in all, BTC is likely to maintain its general uptrend. Kruger also believes that the Bitcoin course still has immense upside potential:
Look for the market to establish above $ 20,000 in 2021 before the next major upward widening into the $ 30,000 to $ 40,000 range.