As shown in the above chart, an ascending triangle has been formed on the 4 hourly chart.
Many expect the $BTC price to break soon out of the triangle, either up or down.
However, a third scenario is possible. That of a consolidation period around the $36k level +-$3k.
The case for a consolidation period
The US financial year ends at 31/01, while payments for the previous UK financial year are due by 31/01.
It's not a surprise that many take some profit to arrange for capital gains tax payments. This may carry on until the end of January. Demand keeps up by both institutions and retail investors, probably absorbing any sell pressure until the end of month. So, a 2 weeks consolidation period is not out of the question.
In my honest opinion, this is the best scenario for both $BTC and altcoins holders.
For $BTC holders
No price goes up in a straight line. Consolidation periods during bull runs are not only healthy, but also necessary for the spacecraft to refuel in its course to the moon.
As shown in the above chart, the 50 daily moving average lags around $10k behind the current price. A consolidation period could be useful for it to catch up with the current price.
For Altcoin holders
A consolidation period in a bull run is a magnificent opportunity for alts to pump. 2 weeks are enough for them to pump hard and stabilize close to the new highs.
The first round of the altcoin period is already here.
Comparing to their 2020 close (that's only 17 days ago š):
- $ADA is up more than 100%.
- $DOT and $LINK are a short shy of a 100% up.
- $VET is "only" 50% up.
But that's only the beginning.
The next 2 weeks could be marvellous for alts (well at least for the legit projects), provided $BTC keeps up consolidating.
Let's all pray for a 2 weeks consolidation period!
Crypto-brothers and crypto-sisters, may the alt pump be with us!
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