Despite bitcoin's price growth to a three-week high, some analysts remain cautious and wait to see the cryptocurrency steadily break above the key $ 11.200 mark before believing the bull market will return.
Crossed the threshold of $ 11.200
The largest cryptocurrency by market value rose 3,5% to levels above $ 11.000 on Friday last week. The run to $ 11.000 broke up from the past two-week range of approximately $ 10.500 to $ 10.800.
On Saturday, Bitcoin's price rose to $ 11.484, the highest level since September 2. Likely driving the move was optimism over the prospects for a US stimulus package after the White House upped its offer by announcing plans to exceed $ 1,8 trillion. Bitcoin is currently trading close to $ 11.300, up 6% from the low of $ 10.400 seen earlier this month.
Analysts remain cautious ahead of the US election
Although the recovery in Bitcoin prices and the breakout of the previous price range is a very good sign, analysts and traders remain cautious, even if the latest movements seem to confirm the theories of the market's bulls.
"We believe that a breakout of the September 19 high of $ 11.200 is a more significant catalyst for further upside," said Lennard Neo, head of research at Stack Funds. He added that Bitcoin could remain stable in the $ 10.000 to $ 11.200 price range until more clarity emerges ahead of the US election in November.
Bitcoin's rejection of $ 11.200 on September 19 was followed by a four-day sell-off to its low of $ 10.200. In other words, the cryptocurrency has set a high of below $ 10.200, a bearish pattern.
As such, a break above $ 11.200 would be more credible evidence of a bullish breakout, as pointed out by Neo. Meanwhile, Simon Peters, a crypto market analyst at the eToro investment platform where possible buy shares, said bitcoin must hold or establish a new base above $ 11.000, in which case it could move to the next psychological threshold of $ 12.000.
This is because bitcoin failed several times in mid-September in wanting to absorb the selling pressure above $ 11.000. And while Neo and Peters remain cautious, Phillip Gillespie, CEO of over-the-counter liquidity provider B2C2 Japan expects volatility to pick up in the near term, coinciding with the U.S. election scheduled for November 4.
“If we weren't a few weeks away from the US election, I'd think we have a bullish configuration in bitcoin,” Gillespie said sharing his view on Thursday's breakout of the triangle.
