Bitcoin's price maintains a medium-term bearish outlook, but a Tweet from Elon Musk about Tesla's ability to accept the cryptocurrency as payment again allowed for a sharp rise overnight.
The price of Bitcoin continued its rebound from the technical threshold of $30,000 and a Tweet from the founder of Tesla yesterday allowed the price of the leading cryptocurrency to accelerate its trend and come to move again this morning near $40,000.
Tesla had acquired 1.5 billion dollars of bitcoin during the first quarter of 2021 and Elon Musk supported the cryptocurrency through repeated tweets, before going back, stating that Bitcoin was too energy-intensive and did not match the visions of the car manufacturer. The company had actually sold $272 million worth of them, allowing it to inflate its first-quarter results by $101 million, representing 23% of its profits for the period.
Then, yesterday, Tesla announced that payment in cryptocurrencies would be available again when the mining (operation to create new coins through solving mathematical problems) would be generated at 50% through renewable energy. According to available data, nearly 40% of the world's mining is already done through “green” energy.
Bitcoin's price has rebounded by almost 30% since the second test near $30,000 on June 8 and is expected to continue until the major resistance level of $42,000. Indeed, this threshold had led BTC to a correction at the beginning of the year before an important bullish comeback and the reaching of the historical high near $65,000 on April 14.
This level also corresponds to the 200-period moving average and the 61.8% Fibonacci retracement (rise from January to April 2021) and has already served as a technical level on numerous occasions since.
A validated breach of the $42,000 would allow for an acceleration of the trend toward the 100-period moving average, currently located near the $50,000 mark and the 38.2% Fibonacci retracement. This should especially invalidate the prospect of a continuation of the downtrend initiated in April.
A further failure below the moving average on the other hand would confirm a reversal, shoulder-to-head chart pattern, which would lead to a sharp acceleration and lead the Bitcoin price to break the $30,000 mark. Below this level, BTC would head close to $20,000, the former all-time high, reached in 2017 and corresponding to the weekly moving average and the 2020 oblique support.
(Chart Source: Tradingview 14.06.2021)
In the shorter term, the Bitcoin price has now broken through the May/June oblique resistance and is expected to break through the $40,000 mark soon, before continuing towards the resistance range around $42,000. A breach, as shown in the daily analysis, would resume its uptrend. A return below the oblique, currently located at $37,600, would invalidate this bullish recovery and lead to the aforementioned bearish acceleration in the Bitcoin price.
Disclaimer: This material has been created for information purposes only. All views expressed in this document are my own and do not necessarily represent the opinions of any entity.
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