Bitcoin Poised For Gains After Recent Pullback

Bitcoin prices are well-positioned to continue their upward trend in spite of the retracement they experienced over the last few days, according to several analysts.

The digital currency broke through $14,000 on October 31, reaching a fresh high for the year on CoinDesk.

However, the cryptocurrency quickly fell back, declining to $13,221.55 earlier today, additional CoinDesk figures show.

[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]

Profit Taking

Multiple traders pointed to profit taking as causing this retracement, with Constantin Kogan, managing director of Wave Financial Group, stating that:

“As the price rises to certain levels, in this case to $14k, there is a massive withdrawal of BTC from trading platforms.”

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He described this practice as “fixing the profits,” or profit taking.

Joe DiPasquale, CEO of cryptocurrency hedge fund manager BitBull Capital, also weighed in on this development.

“Bitcoin’s move between $12,000 and $14,000 was not sustainable since the market hadn’t quite tested the support at $13,000 before attempting the next resistance,” he stated.

“What followed was expected profit-taking and Bitcoin was bound to return to levels around $13,000.”

In spite of the recent pullback, he described the sentiment surrounding bitcoin as “bullish.”

Bitcoin’s Price Consolidation

DiPasquale also spoke to the consolidation that bitcoin has been experiencing between the $13,000 and $14,000 price levels, stating that it is “healthy for future price growth.”

Denis Vinokourov, head of research for London-based digital asset firm Bequant, took a similar stance, stating that:

“Consolidation at this stage should be seen as a healthy development for the market.”

Bullish Outlook

Several analysts expressed a positive outlook for bitcoin’s future price movements, emphasizing their expectations for future gains.

“BTCUSD is currently struggling to break the $14,000 mark,” said Nicholas Pelecanos, head of trading at NEM Ventures.

“On the surface this might just seem like a usual pullback from a psychological level but historically a break of the final resistance before the all time high generally leads to the start of a more aggressive bull market.”

Tim Enneking, managing director of Digital Capital Management, also weighed in.

“$14k was certainly rejected, but that is hardly a surprise, nor bad news for BTC going forward,” he stated.

“The fact that BTC broke through $14k after so long and that the drop thereafter was only about 7% is actually a real show of strength,” said Enneking.

“If $13k holds, particularly in an atmosphere with so much uncertainty because of the US election and its aftermath, it seems clear that $14k will fall (on the way up) over the short term and that the ATH (all time high) will not be far behind,” he predicted.

Disclosure: I own some bitcoin, bitcoin cash, litecoin, ether and EOS.

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