The largest cryptocurrency by market capitalization, bitcoin (BTC), hit its highest point since August earlier this month. Bitcoin, however, fell after The US Commerce Department reported that personal consumption expenditures (PCE) price index data rose by an unexpectedly strong 5.4% in January.
Bitcoin is still holding above the $23,000 psychological mark for bulls. A green close and a short-term victory for the bulls are possible as BTC approaches the monthly close well above $23,000.
A popular cryptocurrency analyst has revealed what he believes could lead to the next Bitcoin rally. According to analyst Michael van de Poppe, Bitcoin is likely to dip below $23,000 after failing to overcome resistance above $23,800 during yesterday’s rally. He believes that if Bitcoin is able to regain support at $23,000 following its expected drop, it might spark a recovery to $25,000.
The analyst said that he will be considering the above-mentioned scenario right now for Bitcoin. BTC rejecting the vital $23,800 level would mean that the support would be put to another test.
Van de Poppe is also expecting a short-term retrace for Bitcoin, but he is still positive about the long-term prospects of the cryptocurrency markets. The analyst thinks that cryptocurrency is simply consolidating before the next leg up after taking into account the total valuation of all digital assets.
The overall market value of cryptocurrencies is still painting a clear image, according to him. The analyst said that 2017 saw a retest of the all-time high when BTC retested the bottom twice.
“Simplified, there’s still room for crypto to continue the rally in Q2 of this year, as we’ve had a significant amount of intrinsic shocks in the markets past year. Max pain scenario is upwards, not downwards. Positioning myself into longs and buying the dip, patiently.”