Bitcoin [BTC] once again broke through the $102,000 mark on the price charts, ahead of the upcoming presidential inauguration on January 20th, a significant event. This latest upsurge propelled BTC’s price above key moving averages, further consolidating a strong bullish sentiment. With the inauguration just a few days away, the looming question is – What trajectory will the cryptocurrency take from here?
Is Bitcoin poised for further gains?
Upon analyzing the daily chart, Bitcoin broke past $100,000 and successfully retested it as a support level, signaling a probable continuation of the upward trend. This recent price action differs from the previous spike to $102,000 on January 6, where the price quickly retraced from the $100,000 level. The immediate bullish target is set at the supply zone and the bearish order block between $105,000 and $108,000 (highlighted in red). If Bitcoin manages to clear the resistance at $108,000, the next significant level to watch would be at $122,000. Given that the daily RSI indicator is not yet signaling an overbought market, there is potential for the rally to extend further.
However, the recent surge to $102,000 did not witness a substantial increase in trading volume, offering a word of caution for the bullish camp. In case of a reversal, key levels to monitor include $100,000, the moving averages at $97,000 and $95,000, or even the lower end of the range at $90,000.
Liquidity Hunt towards $103,500?
Furthermore, Coinglass’s liquidation heatmap indicated the possibility of Bitcoin targeting $103,500, which represents a crucial liquidity cluster that could pull the price towards it. Conversely, there are also liquidity pockets at $100,500 and $98,800 on the downside, likely to draw price action during downward movements. In essence, these price levels might witness a liquidity-driven surge. Notably, with relatively flat liquidity above $103,000, a short squeeze beyond this point could propel the price towards the target range of $105,000 to $108,000 or even higher.
Meanwhile, the 25-Delta Risk Reversal (25RR) forecasted a highly volatile weekend ahead, with anticipated volatility of 6 and 4 points on Saturday and Sunday option expiries respectively. A positive 25RR suggests that traders are anticipating significant price fluctuations to the upside, with a premium on call options (bullish positions).
In summary, Bitcoin might experience a sharp rally over the weekend, and if the insights from the Options market materialize, the price target of $105,000 to $108,000 could be swiftly achieved.