A bitcoin breakout above a 'final resistance' level would signal another 18% upside to $80,600, analyst says
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- Bitcoin is testing its "final resistance" near record highs, according to Fairlead Strategies.
- The research firm said a confirmed breakout would suggest bitcoin could rise 18% to $80,600.
- "A breakout would be a long-term bullish development, leaving no resistance left," Fairlead Strategies said.
The price of bitcoin is testing its "final resistance" and could surge an additional 18% to $80,600 if a breakout is confirmed, according to Fairlead Strategies' Katie Stockton.
In a Monday note, Stockton outlined that the final resistance level of $64,900 will be knocked out if bitcoin closes above that level this Sunday.
"Two consecutive weekly closes above ~$64.9k are required to confirm a breakout in our work. If confirmed, a breakout would be a long-term bullish development, leaving no resistance left," Stockton said.
Bitcoin reached a new record high above $69,000 on Tuesday, well about its final resistance level.
The price of bitcoin has surged more than 60% year-to-date following the approval of several spot bitcoin ETFs and growing anticipation of the halving event, which is set to occur in April. The halving event refers to the halving of bitcoin mining rewards, which should further limit new supply of the cryptocurrency.
The strong price action in bitcoin has led to bullish momentum signals in the short-, intermediate-, and long-term timeframes, according to Stockton.
"Momentum is strongly positive across timeframes, which warrants a bullish bias," Stockton said. "Long-term momentum is positive, and there are no signs of long-term upside exhaustion, supporting a bullish bias for the months ahead."
Amid the bullish backdrop for bitcoin, there are still downside risks. Stockton highlighted bitcoin's rising 50-day moving average as a support level to watch, which currently sits at $48,736, which represents potential downside of 29% from current levels.
"We are watching the DeMark Indicators®, however, which have the chance to flash an intermediate-term 'sell' signal next week," Stockton said, adding that a sell signal would indicate that bitcoin could consolidate for the next nine weeks.