Tuesday, April 23, 2024
SeriouslyFresh.1100x220
DigitalSelect1100x220
MT2.1100x220
Evina 110o x 220
MediaXO.1100x220

    Is Bitcoin Up for a Breakout?

    The cryptocurrency market has been on the rise since the beginning of 2023, with Bitcoin being the most dominant player. The price of Bitcoin has managed to break above its resistance at $29180 created in March to reach a new high at $30430 in April 2023. Is the current breakout sustainable? Is it time to buy Bitcoin CFDs and other Cryptocurrencies? We have discussed these important questions in this work to guide beginners eager to learn about the crypto market today.

    What you need to know about Bitcoin

    Bitcoin is a decentralized digital currency that operates without the need for a central authority or intermediary. It is based on a peer-to-peer network that allows users to send and receive payments without the need for a third party to validate transactions.

    Meaning of Breakout

    In the financial markets, a breakout is a term used to describe a price movement where the price breaks through a level of support or resistance.

    In the case of Bitcoin, we recently witnessed a breakout above its current resistance level of $29,180 created in March 2023 which suggests a potential bullish trend for the crypto market.

    However, investors are skeptical whether the recent breakout above this level is sustainable or just a false breakout.

    Is Bitcoin Up for a Breakout?

    Bitcoin has given the first flash of a breakout long awaited by investors to confirm the beginning of a bullish trend in 2023. The price will be expected to hold above this level in the coming weeks.

    For the breakout to be confirmed, the price needs to hold above this level for a consecutive four weeks and possibly form a new base above $30,000 level. This would mark the beginning of a long-term bullish trend above the level seen last year.

    Notwithstanding, Bitcoin is now up by over 86% this year from its low of $17182 at the beginning of the year 2023. This is a healthy sign for Bitcoin so far this year.

    The recent gains in the market are largely driven by the expectations of a slowdown from the Federal Reserve on its protracted interest rate hikes. The Federal Reserve hiked interest rates for the ninth consecutive time in March, in its continued drive to cool inflation. However, with the massive reduction in the inflation rate which is sitting at 6.04% in February 2023, the market expects the rate hike might be over soon.

    Other Factors Driving Up the Price of Bitcoin in 2023

    ● Adoption by Institutional Investors: There has been increased adoption of Bitcoin from major institutions in 2023, especially after the disappointment seen in the traditional banking system following the collapse of the Silicon Valley bank.

    ● Regulatory Changes: The increased regulation for Bitcoin and other Cryptocurrencies in many countries today has attracted more investors to the crypto market

    ● Global Economic Conditions: The global economic crises and instability in different parts of the world have been pushing investors to seek alternative investments, in Bitcoin and other Cryptocurrencies as a hedge against the rising inflation rate.

    ● Development and Innovation: The development of new technologies and applications related to Bitcoin and blockchain had attracted more investors into the market, thereby increasing the demand for Bitcoin.

    Conclusion

    The recent breakout in Bitcoin prices is a positive sign for investors, but the sustainability of this breakout is still in question. The driving force behind this rally has been the expectations of a slowdown from the Federal Reserve on its protracted interest rate hike. For the breakout to be confirmed, Bitcoin needs to continue its upward momentum and break through its next resistance level of $31,850. Our technical analysis of Bitcoin price shows that prices could easily reach $33,000 if the upside price momentum continues.

    Related Articles

    Subscribe to our newsletter

    To be updated with all the latest news, offers and special announcements.

    24 Seven 600x500
    WT42%
    MobileArts600x500
    DigitalSelect600x500
    Evina 900x750
    SeriouslyFresh 600x500
    MT2.600x500