After Tesla’s bitcoin purchase: bitcoin analysts expect rise to $70,000 and more
Calls for a $70,000 bitcoin are picking up steam among tech market analysts after the cryptocurrency makes its way onto Tesla’s balance sheets.
Cheds, an independent cryptocurrency analyst of Bitcoin Trend app who enjoys a massive following on Twitter, sees the BTC/USD exchange rate rising by at least 70 percent in the coming sessions.
„Just an observation,“ the analyst said, referring to a fractal-like relative strength indicator for his bullish analogy. According to Cheds, the indicator has always sent bitcoin prices higher when it enters a „power zone“.
The „zone“ represents the overbought areas in the chart above. An RSI reading above 70 indicates that Bitcoin is in an overbought area, typically heading for a sell-off.
However, in the last two breakouts above 70, the cryptocurrency has held above 70, leading the spot price up 70-100 percent.
„Based on this theory, the [bitcoin] price should reach around 70k before it cools down, sometime in the next 3-4 weeks,“ Mr Cheds said.
Tesla’s monster bitcoin purchase
Earlier, Bitcoin set a new record high, reaching a level above $47,500 for the first time in its 12-year history. Traders flocked to the cryptocurrency market after American carmaker Tesla announced it had bought $1.5 billion worth of bitcoin as „alternative reserve assets“ to its cash holdings.
In its filing with the Securities and Exchange Commission, Tesla also wrote that it plans to buy more Bitcoin in the future and – perhaps – even allow it to be used as payment for its products and services.
The announcement has spurred analysts to make aggressive bullish calls on Bitcoin. Mike McGlone, the senior commodity strategist at Bloomberg Intelligence, said Monday that the cryptocurrency’s price will reach $50,000.
Some think it could even top $100,000 if rich companies take inspiration from Tesla and buy Bitcoin.
Among them, apparently, is Mitch Steves, an analyst at the Royal Bank of Canada. He expects Apple to become the next big buyer of the decentralised cryptocurrency – or even start offering a crypto wallet or exchange service, as PayPal did in October.
Bitcoin at $75K
Meanwhile, analysts at TradingShot, an independent market analysis firm, believe Bitcoin will reach $75,000. They cite a so-called LMACD bullish cross for their upside analogy.
„Even the $75,500 target for a potential +98% rise would be quite realistic within a 2-month timeframe as it would hit the 2.5 Fibonacci extensions,“ TradingShot said. „The only Fib extension of the Fibonacci channel that has not yet been hit in +0.5 intervals (see how 1.5 and 2.0 have already been hit).“