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Bitcoin price prediction: BTC testing the $40,000 resistance, rejection to follow?

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  • BTC trades just under $40,000 resistance.
  • Closest minor support at $38,000.
  • BTC`s next resistance at the $42 all-time high.

Today`s Bitcoin price prediction is neutral as the market has extended itself too far from the previous major swing low of $32,500.

Bitcoin price prediction: BTC testing the $40,000 resistance, rejection to follow? 1
Cryptocurrency heat map by Coin360

Most of the market continues trading in the green for the past 24 hours. Bitcoin has continued pushing the overall market higher. MKR and BNB are the top major Altcoin performers, while DOT and LINK are still preparing for another push higher.

Bitcoin price prediction: BTC testing the $40,000 resistance, rejection to follow?

In our previous Bitcoin price prediction, we mentioned how Bitcoin is targeting the $42,000 all-time high. First, Bitcoin has to break above the previous resistance of $40,000. Currently, Bitcoin trades just below the price mark. Therefore, we could see Bitcoin reversing once again and setting a higher low before making a move to break the all-time high.

Bitcoin price movement in the last 24 hours

Over the last 24 hours, Bitcoin has traded with a volume of almost $71 billion. A range of

$37,254 – $39,768 indicates a decent amount of volatility in the market. After several hours below the $38,000 resistance, Bitcoin broke higher and reached the next resistance at $40,000.

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Bitcoin price prediction 06.02.2021.
BTC/USD 4-hour chart, Source: TradingView

BTC/USD 4-hour chart – Bitcoin has gained over 20 percent from the previous swing low

Looking at the 4-hour chart for BTC/USD, we can see that another higher high has been set, indicating bitcoin`s bullish momentum. This was a result after Bitcoin spent several days consolidating around the $32,500-$34,500 area.

From there on, Bitcoin gained strength to move higher to test the previous high at $38,664. After a small rejection on the 4th of February, Bitcoin did consolidate for most of Friday. However, overnight, Bitcoin did manage to attempt another push higher. It was successful as the price rapidly reached the $40,000 resistance.

Considering that BTC/USD has already moved by more than 20 percent without a clear retracement, the analyst expects Bitcoin to reject further upside for now. The market needs another higher swing low set before it can prepare to move towards the all-time high.

Bitcoin could find the area of support around the previous resistance of $34,500. This would mean a relatively large retracement. However, the price did extend very fast over the last two days. Another smaller support level is seen around $36,000, although it likely will not BTC/USD from moving lower if it is reached.

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Therefore, the analyst believes that traders should wait for Bitcoin to retrace once again and set a new higher low. Further upside towards the all-time high of $42,000 is still possible; however, placing a trade right now does not offer an adequate risk/reward ratio. In fact, Bitcoin offers a much better short position opportunity right now. This, however, would mean additional risk as BTC/USD could simply continue moving higher even though it is overextended.

Bitcoin Price Prediction: conclusion

Overall, Bitcoin price prediction for today is neutral. The analyst believes that Bitcoin is overextended, and a retracement that sets another higher swing low is needed. Once Bitcoin retraces, it could consolidate for several days and build a base for another push higher – this time, likely above the current all-time high at $42,000.

Despite the prediction, Bitcoin could still continue higher today as the $40,000 price level will get tested while the bullish momentum still lasts. Long position, however, would not be advisable right now – the best option would be to wait for further price action development.

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While waiting for further price action, read our long-term Bitcoin price forecast or see the latest opinion on why Bitcoin is not viable as a means of exchange.

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.

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Terra prepares to burn more than 9% of LUNA’s total supply

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Burning nearly 90 million LUNA tokens into the community pool can put an upward pressure on the native token’s price.

Do Kwon, co-founder and CEO of Terraform Labs, the South Korean company behind the blockchain project Terra (LUNA), recently announced on Twitter that on-chain voting for project 44’s proposal will begin on Wednesday. ).

The proposal to start burning 88,675,000 LUNA from the community pool to mint 3 – 4 billion UST will reduce the total supply of native token by more than 9%.

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TVL on Earth reached ATH

After the integration of the IBC protocol last week and the launch of Wormhole V2 support for Terra, the total blocked value (TVL) in protocols on the network has reached a new high.

Last week, TVL on Earth reached $10.22 billion, with the Anchor, Lido, Mirror and Terraswap protocols accounting for more than 90% of the amount, according to data from DeFi Llama.

Currently, at US$9.97 billion, Terra is ranked as the fourth blockchain with the largest TVL, following Ethereum, Binance Smart Chain and Solana.

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New Bitcoin ETF Offers Shorting Bitcoin Futures, Creators Warn of Multiple Risks

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Direxion has filed for a Bitcoin ETF that allows traders to short BTC futures contracts

According to an article by Bloomberg, a new Bitcoin ETF, if approved, will enable traders to short Bitcoin futures. The filing was submitted on Tuesday, Oct. 26.

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Direxion wants to launch Bitcoin futures ETF for short-sellers

Bloomberg has written that, on Oct. 26, Direxion submitted documentation to launch the Direxion Bitcoin Strategy Bear ETF. Last week, two ETFs that track the performance of Bitcoin futures were launched by ProShares and Valkyrie.

Now, the BTC futures ETF industry in the U.S. may reach a new milestone—if the launch of the ETF for bears is approved by the U.S. Securities and Exchange Commission.

The debut of Bitcoin futures products last week prompted Bitcoin growth to almost $67,000 and a new all-time high.

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However, today, the flagship cryptocurrency retreated below the $60,000 level as a mind-blowing half-a-million worth of liquidations were conducted across major exchanges: Binance, Bitfinex, OKEx, Huobi and so on.

Slightly over $500 million worth of those crypto liquidations were long positions.

BITO ETF gains $1 billion in just two days

ProShares Bitcoin ETF last week became the second-most-traded asset on the NYSE on its first day of trading. Buy orders to the tune of 10,100 were placed on BITO (the ticker the ETF goes by), and seven times more orders were placed to sell it.

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After trading for two days, BITO reached $1 billion in net asset value. That is the equivalent of the net asset value of several Canadian Bitcoin ETFs that have been trading for a while already.

Direxion fund bears lots of risks

The new Bitcoin ETF filed for by Direxion bears numerous financial risks for short-sellers, the company warns. Trading this ETF may lead to shorters getting wiped out, Bloomberg writes, and Bitcoin’s massive price swings would be a problem here, too.

The SEC filing states that if you are not prepared to lose all your funds by investing in this ETF, you should not bet on it.

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This week, some in the crypto community also expect another Bitcoin futures ETF to kick off—the one filed for by the VanEck asset manager.

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Blockstream is sponsoring this tech for scaling Bitcoin [BTC]

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Major blockchain technology company, Blockstream has announced its sponsorship of work on Federated E-Cash. For the uninitiated, David Chaum was the man behind the concept of E-Cash that predates Bitcoin.

E-Cash Federation, on the other hand, is an entity that comprises of independent members assembled to develop a multi-sig wallet for the purpose of being a “blind, distributed custodian by acting as an e-cash mint.”

One of the main factors that have impeded Bitcoin’s adoption is scalability. On that note, Adam Back-led Blockstream has made significant strides. Even as scaling solutions like the Lightning network and federated sidechains have paved the way for large-scale adoption of the crypto-asset, they are yet to see substantial growth. Here come Federated blind mints, which the tech firm believes are a “natural complement to the existing scaling solutions.”

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Blockstream’s tryst about Bitcoin scaling

Blockstream stated that Federated E-Cash can help scale Bitcoin. It cited an innovative exciting possibility of integrating LN into federated mints. This, in turn, would make them interoperable with each other and the broader space. It further stated,

“One could imagine the emergence of community-run federations, where users have a natural trust in the federation members, which isn’t the case with traditional custodians. For the larger number of Bitcoin users who rely on custodial wallets to store their bitcoin, switching to an E-Cash Federation, reduces the trust profile and increases the privacy guarantee for these users.”

Blockstream is looking at an experimental project of a Federated E-Cash scheme dubbed MiniMint that is currently under development.

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$16M Funds for Bitcoin mining STO

The latest news comes a week after Blockstream announced raising $16 million funds in the sixth tranche of its BTC mining-focused security token [STO], called the ‘Blockstream Mining Note [BMN].’ This marked the rapidly rising interest from individual and institutional investors.

It was in March 2021 when Blockstream formally unveiled its BMN security token. Its offering essentially facilitated non-United States investors with an alternative to mine Bitcoin or invest in BTC mining stocks mining BTC with the help of BMN’s associated hash rate. Additionally, it was issued on Bitcoin’s Liquid sidechain with each BMN Series 1 granting market players up to 2k Tera hashes per second of BTC mined at the Canadian blockchain technology company’s enterprise-grade mining facilities.

Besides, Blockstream is also gearing up to list its BMN security token on Bitfinex Securities, which happens to be a relatively new STO platform by Bitfinex.

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Blockstream’s tryst about Bitcoin scaling

Blockstream stated that Federated E-Cash can help scale Bitcoin. It cited an innovative exciting possibility of integrating LN into federated mints. This, in turn, would make them interoperable with each other and the broader space. It further stated,

“One could imagine the emergence of community-run federations, where users have a natural trust in the federation members, which isn’t the case with traditional custodians. For the larger number of Bitcoin users who rely on custodial wallets to store their bitcoin, switching to an E-Cash Federation, reduces the trust profile and increases the privacy guarantee for these users.”

Blockstream is looking at an experimental project of a Federated E-Cash scheme dubbed MiniMint that is currently under development.

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