Bitcoin is on the verge of a bullish breakout; $18k BTC in sight?
After weeks of consolidation, Bitcoin (BTC) and the overall cryptocurrency market have registered a short-term rally in reaction to positive inflation data on December 13.
The rally has seen Bitcoin hit a new four-week high, with investors monitoring the asset’s price movement for a bottom likely to usher in another price breakout. Based on the flagship cryptocurrency’s recent price movement, News from Kitco analyst Jim Wycoff on December 13 pointed out that Bitcoin has potentially begun a “bullish upside breakout.”
According to Wycoff, Bitcoin bulls have built a short-term technical advantage after a battle of near-equal strength.
“Today’s price action has produced what appears to be the beginning of a bullish upside ‘breakout’ from the choppy and sideways trading area on the daily bar chart to suggest an uptrend in price will develop. Bulls have gained the technical advantage in the short term , Wycoff said.
Bitcoin positive reaction to CPI data
In fact, Bitcoin rose after the latest Consumer Price Index (CPI) indicated that the Federal Reserve was taking significant steps to win the war to bring down inflation. The latest data showed that inflation in November came in at 7.1% year-on-year compared to the forecast of 7.3%, while the monthly CPI was 0.1% lower against an expected 0.3%.
Along these lines, the crypto market has been monitoring the inflation data since it will determine the Fed’s next interest rate policy. Overall, Bitcoin has been weighed down by the high inflation with the tighter monetary policy putting pressure on riskier assets.
Bitcoin price analysis
At press time, Bitcoin was trading at $17,791, registering daily gains of nearly 5% while weekly gains stand at 4.5%.
Bitcoin is looking forward to regaining the $18,000 zone that served as a critical support level for the asset in recent weeks. But with inflation cooling, Bitcoin’s ability to sustain its gains will mostly depend on the potential of bulls to overpower bears.
In recent weeks, Bitcoin has consolidated around the $17,000 level. Especially if Bitcoin fails to hold the $17,000 position, the asset will be in line for a possible further correction.
Bitcoin Technical Analysis
Elsewhere, Bitcoin’s recent gains have been reflected in the asset’s technical analysis. A summary of the daily goals on TradingView matches ‘buy’ sentiment at 13, while moving averages are also buy at 9. Oscillators are for ‘buy’ sentiment at 4.
The reaction to the CPI data shows that Bitcoin has temporarily side effects from any criminal charges and caveats about the Binance crypto exchange. At the same time, Bitcoin is building momentum following the arrest of FTX founder Sam Bankman-Fried.
Disclaimer: The content of this page should not be considered investment advice. Investment is speculative. When you invest, your capital is at risk.
