As Bitcoin price rises to new heights, top traders say the monthly and
logarithmic chart signal that BTC is entering a new bull trend.
Peter Brandt, a well-regarded veteran trader, recently emphasized the
high demand from institutions as a key catalyst for Bitcoin's strong
performance.
The
strong high time frame technical structure of BTC, especially the
weekly chart, and the strengthening fundamentals are buoying the market
sentiment. In a tweet, Brandt posted the above chart and said:
“Bitcoin—IF
the current gains hold through end of Oct—is poised for the
second-highest monthly close ever. $BTC Institutions are increasingly
involved in Bitcoin ownership. Institutions mark the value of their
assets monthly.”
In addition to the rise in trading
volume and growing institutional appetite, investors are referring to
the logarithmic chart to forecast a broader rally.
Raoul Pal focuses on the Bitcoin log chart
The
log price chart is the most widely used scale by most technical
analysts. A logarithmic chart simply means a chart that represents
common percent changes with equal spacing in a scale.
Raoul Pal, the founder and CEO of Real Vision Group, says Bitcoin's monthly log chart is highly optimistic. He wrote:
“Its
a bitcoin kind of day. The monthly log chart with regression lines is
really something to behold. One of the nicest, post powerful chart
patterns I've ever seen.”
The technical reason behind the
optimism towards the monthly log chart is mainly its clean breakout.
Throughout the past four years, $13,000 has acted as a heavy resistance
level.
As such, on high time frame charts, like the weekly and the monthly chart, BTC always closed below $11,000, except for 2020.
Bitcoin's
clean technical breakout on the monthly timeframe is leading traders
and investors like Brandt and Pal to make strong bullish calls on BTC's
price action. As Pal said, “if history rhymes, 2021 is going to be a BIG
year.”
Q4 2020 may end on a positive note
Apart
from the numerous bullish technical and fundamental catalysts, the
timing of the current rally is also in favor of a major Bitcoin bull
cycle.
According to data from Skew,
Bitcoin had not had three positive consecutive quarters since 2017.
During that year, BTC reached its all-time high at $20,000 following its
second block reward halving in 2016.
Bitcoin could possibly be on
track to record a massively positive gain in the fourth quarter if it
stays above $12,000. If so, that could lead to the same bull cycle
pattern as 2017. Next year would also present the same post-halving
cycle BTC saw in 2017, which further strengthens the narrative of a
newfound bull cycle.
source link : https://cointelegraph.com/news/top-traders-say-bitcoin-log-chart-points-to-a-2017-style-btc-bull-run
