Another all-time record is set this year, the cryptocurrency market cap is now valued above $1 trillion.
The growing interest in cryptocurrencies might be a result of a weakening US Dollar and the prolongation of the pandemic and restrictions. As the US is breaking records of new Covid-19 cases, many investors may consider that the reopening of borders and normal life is far from being achieved, hence the bet is on cryptocurrencies market as during the pandemic last year ROI of the crypto-market prevailed against other markets.
Active Bitcoin addresses already surpassed the 2017 high, and some analysts say that this may trigger another round of sales as some HODL’ers might consider selling their Bitcoins with profit.
Besides the weakening USD there are other factors which may have a weight on Bitcoin’s uptrend, JP Morgan Chase Co.’s long-term Bitcoin price prediction announced on January 5, and the US Banking regulator allowing use of less volatile coins for payments, primarily “proprietary” coins of banks which are bound to the local currency.
There is a razor-sharp triangle on an hourly chart of BTC/USD. The latest moves show exhaustion of bulls, MACD and indicators are at the top of their graphs and signal for caution.
As seen on the chart above, Bitcoin nears a dynamic resistance and if sellers decide to close their positions here, the correction might continue down to $36,385 and $34,440.
Though it might look that the end of the uptrend is near, there is another channel being formed, which shows that Bitcoin against the US Dollar may climb up to $45,000.
The next target for Bitcoin enthusiasts and buyers is $40K whereas the pair may correct to test the dynamic resistance as support and continue the uptrend towards $45K.
The uptrend of the pair may be supported by the newly applied business operations restrictions in the US amid growing number of COVID-19 cases. As a result the US economy might struggle during the winter and the US Dollar will most likely continue the decline, aggressing the growth of the Bitcoin price.