Bitcoin has seen a lot of sideways price action this week but may be able to extend its gains and reclaim higher points. The cryptocurrency continues to trade in the green and appears to be showing signs of further upside in the short term.
At the time of writing, Bitcoin is trading at $23,200 with 9% profit over the past week and 1% profit in the last 24 hours.
Over the past week, Bitcoin has provided more clarity about its price direction. According to a report by Arcane Research, the cryptocurrency managed to slowly break above critical resistance levels at $20,000, $20,700 and $23,000, coinciding with the traditional definition of an upward trend, as defined by Investopedia:
An uptrend describes the price movement of a financial asset when the overall trend is upward. In an uptrend, each successive high and low is higher than the one previously in the trend. So an uptrend consists of higher swing lows and higher swing highs. As long as the price makes higher swing lows and higher swing highs, the uptrend is healthy.
Arcane Research noted the following regarding BTC’s recent bullish momentum and its ability to break past resistance and turn it into critical support:
Bitcoin price is currently at an interesting level. $23,000 acted as resistance in mid-June two weeks ago and is likely to turn into support this week. If the price settles at the current level, it will indicate another higher low and be a bullish signal.
In this sense, Arcane Research expects Bitcoin to continue flirting with the $24,000 resistance and possibly breaking it. This could indicate a continuation of the bullish trend with potential targets at $27,000 and $28,000, on the lower time frames.
Why Bitcoin Is Likely to Hold Its Gains
Bitcoin’s bullish potential has been capped by macroeconomic factors, the collapse of major crypto companies and ecosystems, and increased selling pressure from BTC miners. The latter had to sell more of its BTC shares to meet debt obligations in the face of rising energy prices and lower BTC prices, according to Report by QCP Capital.
In this sense, Bitcoin will have a limited ability to cross $28,000. The trading desk coincides with Arcane Research, BTC price may revisit those levels but it is unlikely that we will see another massive rally like the one that occurred in 2020.
On the contrary, BTC price may trade sideways as it regains higher levels and makes lower lows in three critical support areas: $20,700, $17,500 and $10,000. The latter seems likely to be revisited sometime in 2022, QCP Capital alleges.