Bitcoin Price Forecast: BTC/USD Tops 2017 Peak, Sets Sights Higher

[embedded content]

Bitcoin (BTC/USD) Price Forecast:

• Bitcoin has climbed more than 165% in the year-to-date as investors clamor for returns
• Heralded as a fiat alternative, BTC/USD may have benefited from accommodative monetary policy and covid-related stimulus programs
• Can Bitcoin continue its charge after reaching a new all-time high?

Bitcoin Price Forecast: BTC/USD Tops 2017 Peak, Sets Sights Higher

Bitcoin touched a new all-time high on Monday, briefly surpassing the prior peak of $19,783. Buoyed by a weakening US Dollar, talks of further stimulus and loose monetary policy, the largest cryptocurrency by market cap has thrived in the 2020 market environment. Bolstered by investors who believe cryptocurrency is the eventual replacement to the current fiat system, BTC/USD has climbed more than 160% in the year-to-date.

Bitcoin (BTC/USD) Price Chart: Daily Time Frame (November 2017 – December 2020)

With believers abound and yield-hungry traders searching for gains in a low interest rate world, the case can be made for a continuation of the Bitcoin rally. Furthermore, the technical landscape might also offer signs of encouragement beyond the recent high.

Bitcoin (BTC/USD) Price Chart: 1 – Hour Time Frame (October 2020 – December 2020)

While a new all-time high is an encouraging sign to be sure, Bitcoin also possesses nearby support in the event of another abrupt pullback. Initial buoyancy might be found near the $17,200 level while secondary and tertiary support could reside at $16,500 and $15,837 respectively. While the Thanksgiving-day rout highlighted the considerable volatility Bitcoin can experience without warning, the quick recovery suggests bulls are not ready to surrender recent gains.

Bitcoin vs Gold: Top Differences Traders Should Know

With that in mind, in conjunction with the broader rally throughout the year-to-date, the outlook for Bitcoin remains encouraging in my opinion. Should the rally continue, resistance beyond the prior all-time high of $19,783 and the current peak of $19,861 is relatively sparse, meaning gains could accelerate beyond those levels given the proper demand.

–Written by Peter Hanks, Strategist for DailyFX.com

Contact and follow Peter on Twitter @PeterHanksFX