Bitcoin (BTC) is poised for significant movement, potentially reclaiming $100,000 as a support level and targeting $107,000 in the near future. This bullish sentiment is fueled by a mix of technical indicators and macroeconomic factors.
Three Reasons Bitcoin’s Breakout Toward $107K Is Underway
1. Technical Indicators Support Breakout
Bitcoin has recently confirmed a breakout from a multi-week ascending triangle. This technical formation occurred after the price surpassed the upper boundary near $95,000. Following this, BTC experienced a pullback, retesting the previous resistance level as support. This behavior is characteristic of a valid breakout, reinforcing expectations of a further rally.
Currently, Bitcoin is positioned for a potential bullish crossover between the 20-day and 50-day exponential moving averages. Historical data suggests that similar crossovers have led to substantial price increases. For instance, the last time BTC experienced this pattern, it surged approximately 17% in the following month.
2. Decrease in Selling Pressure from Long-Term Holders
Recent data indicates a decline in selling activity among long-term Bitcoin holders. Specifically, the number of spent outputs from coins dormant for over five years has significantly decreased. Earlier in the year, the average spent outputs approached 2,300 BTC but recently dropped to around 1,000 BTC.
- This trend indicates fewer coins are entering the market.
- Analyst DarkFrost notes that this shift suggests a greater inclination among holders to keep their assets rather than distribute them.
3. Favorable Macro Conditions for Bitcoin
Another positive signal for Bitcoin is its historical correlation with gold. When this correlation becomes negative, Bitcoin has historically surged by an average of 56% within two months. Current indicators suggest that this trend is re-emerging.
Economically, the ongoing expansion of global liquidity and the conclusion of the Federal Reserve’s quantitative tightening are favorable for BTC. Experts, including Bitwise’s Matt Hougan, highlight that Bitcoin bull markets often coincide with increases in the global M2 money supply. This trend could lead Bitcoin to outperform gold in the coming months.
Conclusion
As Bitcoin’s breakout towards $107,000 unfolds, a combination of technical strength, reduced selling from long-term holders, and supportive macroeconomic factors create a positive outlook. Investors and analysts alike are watching closely as the cryptocurrency market evolves, potentially leading to a significant price rally in the near future.
