The short-term bull market that Bitcoin has been caught within over the past couple of weeks has completely altered the sentiment amongst cryptocurrency investors for the better and has led to a strong sense of vitality amongst BTC bulls.
The impacts of this 2020 uptrend have stretched beyond just shifting investor sentiment, as it also appears to have significantly bolstered Bitcoin’s technical strength, with the crypto’s recent lows of $6,400 looking increasingly like a long-term bottom.
Most importantly, however, is the fact that this recent rally has allowed a key technical indicator to flash an elusive bottom sign, signaling to investors that the cryptocurrency could now be positioned for a parabolic rally.
Prominent Technical Indicator Flashes Rare Sign, Signaling a Massive Bitcoin Rally is Imminent
Bitcoin’s 2020 rally has allowed it to climb from its early-January lows of $6,800 to highs of $9,000, which is just a hair above the price at which it is currently trading at.
This massive rally has resulted in renewed technical strength, leading many analysts to grow increasingly bullish on what’s ahead for the cryptocurrency in the new year.
One indicator that recently flashed an incredibly bullish sign is BTC’s direction movement index (DMI), which compares an asset’s prior highs and prior lows to calculate which direction an asset is likely to trend.
This indicator is now signaling that Bitcoin has established an interim bottom, an elusive sign that has only flashed on 3 occasions over the past decade, with each time being closely followed by a parabolic uptrend.
Mohit Sorout, a partner at Bitazu Capital, pointed this out in a recent tweet, concisely noting that “bears will say it’s photoshopped” while referencing a chart that shows the rare sign, which is marked by a crossover between the DMI’s positive and negative directional movement lines.
Bears will say it’s photoshopped.$BTC pic.twitter.com/Jxo0C0YTqg
— Mohit Sorout ? (@singhsoro) January 17, 2020
Just How Far Could the Next BTC Rally Extend?
Although it remains unclear as to whether or not Bitcoin’s next parabolic rally will match the magnitude of those seen in years past, some analysts are noting that a break above a key multi-year descending resistance could spark a move to $100,000 or more.
“Breaking the green line will be what triggers the next parabolic movement that will take us to $100K minimum… You are not late. You are early,” Galaxy – a popular crypto analyst – explained in a recent tweet.
Breaking the green line will be what triggers the next parabolic movement that will take us to $100K minimum.
Save this picture.
You are not late. You are early.$BTC pic.twitter.com/LmSD55hSpv
— Galaxy (@galaxyBTC) January 15, 2020
While considering the elusive DMI crossover that Bitcoin just posted, it seems as though the current 2020 rally is just getting started and could result in another parabolic trend cycle.
Featured image from Shutterstock.