Bitcoin price at $16K and beyond? Here are the bear and bull cases

Published on by Cointele | Published on

Analysts are divided on the short-term outlook on BTC because the momentum remains strong but there are concerns of an overheated rally.

There are numerous positive developments that could continue to sustain the uptrend of BTC. Generally, the cryptocurrency market has seen an increase in trading activity across all types of exchanges.

There is a strong possibility that the main impetus for the BTC rally above $16,000 was the high trading activity and newly emerging appetite for BTC from stablecoin inflows.

If BTC rallies toward $18,750 in the near term, that would leave a minor gap until a new all-time high above $20,000.

Other traders have similarly said that the dip Bitcoin saw on Nov. 12 to sub-$15,500 might have been "The dip." After reaching $15,965, BTC suddenly declined by nearly 4% to $15,440.

Analysts still anticipate BTC to rally toward the end of the year, but in the immediate term, they expect a pullback because historically, BTC has seen corrections throughout prolonged bull cycles.

In 2017, as an example, when BTC rallied toward $20,000, it regularly saw rejections of 20% to 30%. Michaël van de Poppe, a full-time trader at the Amsterdam Stock Exchange, said that Bitcoin is in the "Disbelief phase." Short-sellers and skeptics are increasingly betting against BTC as it reaches toward its record high.

Josh Olszewicz, a Bitcoin technical analyst, referred to the Ichimoku Cloud indicator to point out that BTC is well above the cloud.

The combination of Bitcoin's declining dependence on the derivatives market, the clear breach of the $16,000 resistance level, and various on-chain data points that confirm $15,170 as an important support level for BTC raises the probability of a broader rally.

At the same time, due to the historical tendencies of BTC to see large pullbacks even amid parabolic rallies, traders are preparing for potential sharp drops to buy the dip.