Bitcoin Price Analysis: Is a $1700 Target in Sight?
The Securities and Exchange Commission (SEC) pulled an about-face this week and resurrected the rejected Winklevoss Bitcoin ETF COIN. Although the outcome is still binary and will likely be rejected a second time, there is renewed hope the COIN ETF or something similar will eventually pass SEC regulatory scrutiny. This would allow for the opportunity of a massive influx of untapped investors who do not otherwise have access to or confidence in the Bitcoin market.
The digital currency space market capitalization as a whole just surpassed $30 billion for the first time. This is certainly an indication of a growing and mature ecosystem and makes for a splashy headline, but overall, I put little stock into market capitalization for many alt coins which have various supply variables including no total cap on number of coins, pre-mines, insta-mines, or a majority of supply held by the development team.
USD withdrawals continue to be halted on Bitfinex, one of the leading USD exchanges. This essentially means selling BTC for USD on that exchange can only buy more Bitcoin or another digital currency. It’s a bit of a one-way street at the moment so it’s no surprise that there continues to be a $100 premium on Bitfinex. We can fully expect this to continue until USD withdrawals resume, or the buyers get exhausted, and we probably won’t see full resolution until the former happens. Despite some circulating rumors, I don’t see any evidence to suggest that Bitfinex is insolvent; they are handling digital currency withdrawals without issue. Some users have been avoiding Bitfinex entirely. The Bitfinex cold wallet balance has been on a downtrend since the halt of USD withdrawals.
Bitcoin Unlimited blocks broke an all-time high and resumed their collision course for parity with Bitcoin Core blocks. Bitcoin Unlimited miners may opt to fork with as little as 51 percent of hash power support, though it would probably be closer to 70 percent. I fully expect a hard fork attempt to occur but remain unsuccessful.
Node support for Unlimited and Core largely remain unchanged from the previous week.
All eyes are currently on the inverted head and shoulders, a bullish reversal pattern, which has a neckline at an all-time high. Although traditionally occurring at the bottom of a downtrend with a volume profile, the pattern is convincing.
Expect resolution of the pattern to occur with volume confirmation. The $1700 measured target may seem absurd, especially for some of us who have been watching this space grow over the past four or more years, but based on technicals, it’s the target nonetheless.
Many exchanges have again surpassed gold parity or are sitting just below parity, but the index is again flirting with the gold price, which historically has acted as heavy resistance.
A convincing break of this arbitrary resistance would be additional bullish confluence coupled with the inverted head and shoulders breakout.
The SEC is reviewing the rejection of the COIN ETF.
Total digital currency market capitalization broker $30 billion for the first time.
USD withdrawal on Bitfinex continues to be halted.
Bitcoin Unlimited inches closer and closer to hard fork possibilities.
A bullish chart pattern continues to project ~$1700 target. Watch for a large spike in volume once price breaks current horizontal level.
There is another opportunity for Bitcoin to break and hold above gold parity.