Analyst: Bitcoin breaks out of ascending triangle, next to test $52,000

Bitcoin’s rally extended, hitting $47,754.31 at one point in the past 24 hours, its highest level since Jan. 2, 2022. While there wasn’t an obvious external catalyst for the rally, some positives have indeed been brewing over the past week, such as Goldman Sachs becoming the first major U.S. bank to trade bitcoin over the counter, Ray Dalio’s Bridgewater Fund hinting at investing in crypto funds, Terra, the network behind the Luna token, plans to build a $10 billion bitcoin reserve fund for its stablecoin TUSD, which represents a super-strong buying bid.

Looking at technical indicators, analysts believe that Bitcoin’s break above $47,000 confirms a two-month period defined from a trendline connecting the Feb. 10 and Mar. 2 highs and Jan. 25 and Feb. 24 lows Breakout of the “Triangle” pattern.

Yuya Hasegawa, a crypto market analyst at Japanese bitcoin exchange Bitbank, noted that the bitcoin futures market is accumulating short positions when prices fluctuate below $40,000, leading to a liquidation of about $71 million on Sunday, saying: “From a technical point of view, Look, Bitcoin has broken out of the ascending triangle, which is signaling an uptrend and may continue to rise in the near term.”

Market analyst Richard Perry tweeted: “Decisive Bitcoin breakout this morning. A big fundamental pattern completes above $45,855 (though needs a [UTC] close to confirm), implying resistance to $52,000 Bits are tested and the target of $57,400 is expected to be reached in the next few months.”

The chart below shows that a bullish crossover between the 50-day and 100-day simple moving averages (SMA) is likely to happen soon, reinforcing the positive trend presented by an ascending triangle breakout. A bullish crossover occurs when the short-term moving average exceeds the long-term one, indicating bullish momentum. Bitcoin jumped from $44,000 to $52,000 in the weeks following the 50-day and 100-day SMA bullish crossover last August 19.

Bitcoin’s next level of resistance is $52,000, Fadi Aboualfa, head of research at investment firm Copper, said in an interview with Bloomberg. If this level is breached, Aboualfa believes its price could reach $65,000, close to the all-time high set in November 2021.

But fundamental and macro strategists believe pure technical analysis doesn’t tell the whole story, with Yuya Hasegawa noting that markets should tread cautiously ahead of the U.S. personal consumption expenditures report and employment report later this week, an outcome that could lead to the next FOMC report. The meeting raised interest rates by 50 basis points.

As of press time, Bitcoin is trading at $47,536, a 24-hour increase of 6.11%, with a market value of about $903.37 billion.

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