Bitcoin: Why $34k is the next target for bulls
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- The market structure shifted firmly in bullish favor amidst rising demand.
- The $30k area was an enormously important region stretching back to January 2021.
The price action of Bitcoin [BTC] from earlier this year showed that Bitcoin could climb to $34k later this year. Trading volume and market sentiment could impede progress, but the tides have already begun to shift.
Read Bitcoin’s [BTC] Price Prediction 2023-24
The US Federal Reserve’s decision to pause interest rate hikes was received well in traditional markets. Furthermore, Bitcoin spot ETF applications boosted sentiment, although the SEC’s lawsuits against some of the largest players in the market gave investors some cause for concern.
Are we in for another Bitcoin bull run?
The 2020/2021 bull run saw BTC prices rise by more than 500%. A 13% move higher from $30k to $34k can’t be termed a bull run, but it would certainly establish the $16k area as a long-term bottom.
Before we get ahead of ourselves it must be noted that trading volume has been underwhelming since April. The $30k area is a significant psychological and technical resistance.
But, if the recent strength continues, such a move upward might be possible. The daily timeframe structure break was seen on 20 June. Bitcoin exploded higher on 21 June to break past another lower high at $28.5k.
This established a strong bullish structure, and a higher low in the coming weeks would indicate an uptrend. This higher low could happen at the bullish breaker block in the $27k-$28k area after a pullback. To the north, the 100% Fibonacci extension level (yellow) at $34.2k was the next target.
The Fibonacci extension levels from the early 2023 rally climbed just past the 61.8% extension level at $30.7k before a drop. The current rally retested the $25k region before pushing higher. To the north, $32.8k, $34.5k, and $37.8k are the important resistance levels to watch out for.
The rise in MVRV meant selling pressure could mount soon
The 90-day MVRV ratio climbed the April highs and bulls would be concerned that profit taking could hamper the progress that BTC has made. However, this could present a buying opportunity upon a pullback as well. The dormant circulation also posted the highs for June so far, which meant selling pressure could follow.
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The mean coin age has been rising since late May to suggest network wide accumulation. Combined with the price action, the overall picture showed bullish strength.
A pullback and another move back above $30k in the next week or two would be a hopeful development for BTC bulls.