“Bitcoin is on its way to $117,000”: analyst explains the reasons

With the weekly closing of the price of bitcoin (BTC) above USD 68,000, the possibility of it reaching USD 100,000 has gained more strength. This is despite the fact that it has remained in a range below the all-time high (ATH) of USD 73,700 for seven months.

This is indicated by a new report from the analysis firm Income Generator. “The BTC-USD pair has been consolidating within a sideways range, which I consider a bullish ‘consolidation period’ rather than directionless stagnation,” he introduces.

Generally, periods of consolidation are usually followed by trending price movements that are much more substantial and decisive in nature. These types of conditions can occur in both bullish and bearish directions.

In the current case, the specialist firm maintains that “the most likely outcome is one that could focus the valuations of the BTC-USD pair in a decidedly bullish direction.” His argument is based on a formation of graphic patterns of technical analysis which is called a “bullish flag”.

This term refers to a movement in the price chart of an asset that looks like a flagpole with its flag flying. It consists precisely of a prominent rise (antler) followed later by a lateral period with a moderately downward trajectory (flag).

This structure usually indicates a period of price consolidation after a strong rise to test support and continue the uptrend. Therefore, it normally culminates with an upward reversal, as CriptoNoticias has reported.

If you look at the bitcoin price chart, you can see the formation of a spike from October 2023 to March 2024 with a substantial rise to $73,000. And then, a flag pattern is exhibited with a downwardly pressed sideways consolidation period currently showing signs of breaking out.

With the surpassing of USD 68,000, bitcoin continues to register increasingly higher prices for two months, which breaks the descending channel, as shown in the graph and reported by CriptoNoticias. For Income Generator, This is a more convincing bullish trigger signal that hints at the possibility of breaking the flag. to reach new highs.

“These types of chart patterns can be incredibly useful in terms of their ability to give us a better idea of ​​the trend directions that are most likely at any given time.”

Income Generator, market analysis firm.

Bitcoin could surpass USD 117,000, according to the bull flag

The analysis firm recalls that the flagpole began when BTC was trading at USD 24,000 and ended when it reached USD 73,000. This represents an increase of almost USD 49,000, which according to the psychology of traders could be added to the new maximum of USD 68,000 that breaks the descending channel. Consequently, it is “on the path towards USD 117,000,” he warns.

Historical examples, such as Nvidia stock (NVDA), show these chart patterns can be accurateas the following graph shows. However, the firm makes the reservation that, in the case of bitcoin, the forecast is not as accurate due to the greater volatility of cryptocurrencies.

In this sense, you do not expect the noted bitcoin price projections to be accurate to the penny. “Cryptocurrencies are highly volatile assets that tend to encounter slippages that almost always prevent that type of precision from being possible,” he adds.

Therefore, beyond forecasts, he prefers to focus on the analysis of chart patterns. These serve as a guide to identify trends and possible reversal points within them, he highlights.

Taking into account such considerations, it is stated that is bullish on the BTC-USD pairwith the current momentum potentially pushing prices above $100,000 for the first time in market history.

“In order to reverse my position and adopt a more bearish outlook for the BTC-USD pair, I would need market prices to fall below the October 15, 2024 lows of $64,777,” he clarifies. Therefore, as long as this does not happen, he maintains his expectations of new all-time highs in this cycle for bitcoin.