The price of Bitcoin has reached $19,469 for the very first time after December 2017. However, there are key factors that may be stopping Bitcoin from reaching another all-time high.
BTC prices are rapidly inching closer to the $20K mark and have already reached $19,469 according to Coinbase. This price is their highest ever since the prices in December in the year 2017. Nonetheless, this strong and overpowering cryptocurrency is very close to reaching its past record and overtake it.
As always, nothing in the stock market is guaranteed and there are a few signs of caution for Bitcoin investors to be alert of as well.
Bitcoin Pullback Reasons
In fact, there are 3 possible reasons for Bitcoin to be faced with high chances of a pullback from hitting the $20,000 level. These reasons include a trap from the bulls, overcrowding of the derivatives market, and a resistance overhead.
Possibility Of A Trap From Bulls
Usually, a trader of cryptocurrency is called a ‘Bitcoin Jack’. This pseudonymous trader called the bottom of Bitcoin in the month of March along with the laying out of a possible scenario of a bull trap.
‘Bull trap’ means a technical scheme with the help of which the late purchasers or extended holders are trapped while the asset price declines.
In case BTC is discarded from the range between $19,200 and $19,300 zone, the traders are recommended that they will witness a high possibility of a pullback. In fact, the macro-level of support might remain at the price level of $16,000 for Bitcoin.
In reference to Bitcoin Jack, the predictions for the trend of probable price, as stated by a trader of ‘NekoZ’ that in case the price declines to a mere $12k then it will be scary since their consolidation level is from 16k to 18k. He further added that the drop is very likely, considering the resistance usually sustains on day 1 and then fluctuates.
$20,000 As A Major Level Of Resistance
Once, Bitcoin surpasses the $20,000 mark, they will be looking for new highs that might range between $25,000 and $100,000 if the present cycle is maintained.
However, the current sellers of BTC are strongly defending the price levels in order for it to surpass that much-awaited $20k price.
High Rate Of Funding
The rate of funding for BTC ranges between 0.05% and 0.1%. The short-term sellers are aggressively driving up the price levels towards $20k.
The market of over-the-counter (OTC) is very active indicating that whales, institutions, and investors of high net-worth are actively buying Bitcoin.