Bitcoin Price Near ‘Monster Move’ After Weeks of Range Trading: Analyst
The price of Bitcoin (BTC) has seen low volatility throughout the past six weeks, hovering in the $9,300–$9,900 range for most of the time. This has led traders to warn that it is likely to cause a massive price movement in the near term.
Over the last 12 months, Bitcoin has seen two extended ranges. One was in June 2019 and the other in December 2019. In both instances, the price of BTC saw a 40% move in the following months.
Where will the big move happen?
Traders generally foresee two short-term scenarios for the top-ranked digital asset on CoinMarketCap. One is a rejection at $9,200 that will be followed by a fall to the $7,000s, and the other would entail the price holding $9,200 then retesting $10,500 to potentially see the start to a newfound rally.
Whichever direction the price heads in the upcoming weeks, analysts anticipate a highly volatile trend for the cryptocurrency market.
Bitcoin is also entering a “fear zone” on various investor sentiment indices, suggesting traders are becoming increasingly cautious about the short-term trend of BTC.
Bitcoin Fear and Greed Index plotted on a four-hour BTC/USD chart. Source: Byzantine General
Variables that may affect BTC in the near term
There are two main variables that may shift the price trend of BTC in June. One is the risk of miners selling more Bitcoin after a difficulty adjustment, and the second is JPMorgan Chase’s surprising praise of the top cryptocurrency.
Earlier this week, JPMorgan Chase said Bitcoin has “staying power” after it survived from its crash to $3,600 in March. It completed a V-shaped recovery by surging above $10,000 within less than three months.
At a period where institutional demand for Bitcoin has been rapidly increasing since the start of 2020, JPMorgan Chase’s change in stance toward BTC could bode well for Bitcoin’s future price action.
However, the mining difficulty of Bitcoin is set to increase by 13% within the next three days, meaning there will be a significant increase in the cost of mining. This may apply additional selling pressure on the Bitcoin market, amplifying the short-term bearish scenario.