Bitcoin has stolen the spotlight from cryptocurrencies as its price surged by more than 5.5% after opening on Monday. The sudden bullish momentum caught many investors by surprise given the significant losses in gold in the same period.
Bitcoin targets $ 50,000
Bitcoin looks like it could head towards $ 50,000 after another bullish move.
Recent transaction history shows that Bitcoin is on top of stable support.
According to IntoTheBlock's In / Out of the Money Around Price (IOMAP) model, nearly 560,000 addresses have previously purchased more than 580,000 BTC between $ 43,150 and $ 44,540, and more than 1 million addresses have purchased 700,000 BTC at an average price of $ 39,650. These large barriers to demand could have the strength to hold prices back from a sharp correction in the event of a sell-off.
Also, there is no major supply wall ahead of Bitcoin. The IOMAP model reveals that the only area of significant interest is between $ 48,640 and $ 50,000. At this price, roughly 550,000 addresses hold nearly 361,000 BTC.
The fact that the underlying demand zone is more significant than the general supply area suggests that Bitcoin may advance further before its next pullback.
Despite the optimism shown by the chain metrics, some technical indicators do not seem so optimistic.
The Tom DeMark (TD) sequential indicator has presented a sell signal on Bitcoin's 12-hour chart. The bearish formation developed as a green nine candle, indicating a retracement of one to four 12-hour candles or the beginning of a new countdown down.
Now that Bitcoin has hit the target of $ 46,000 predicted by the descending triangle where it broke out on July 26, an increase in profit-taking seems imminent.
When considering the IOMAP model and the TD Sequential, it is reasonable to assume that Bitcoin could see another tranche before the 12-hour session closes. A considerable increase in buy orders around current price levels could push BTC towards the supply barrier of $ 48,640- $ 50,000.
Around this price level, investors could expect a pushback that sends Bitcoin into the $ 40,000 wall of demand, confirming the outlook presented by the TD setup.