For an extended period of time, Bitcoin managed to remain at its consolidation level. This sideways area is delimited by the USD 55,000 and the USD 61,000 price. Usually, consolidation periods are a good thing, as they allow prices to “breath” and prepare for the next move. For Bitcoin, there are 3 major news that would enable BTC prices to potentially BOOM in the short-term. Since the psychological price of USD 60,000 was already breached, the next target on the short-term horizon is definitely the USD 70,000 price target. What are those 3 reasons that will bring Bitcoin up soon?
1- BTC Option contracts worth Billions Expire THIS WEEK
Bitcoin Options are contracts that allow investors to buy or sell BTC at a specified price within a set time period. Every month, those contracts expire and make way for new contracts to be set. For this current month of March 2021, Friday 26th represents the day where those contracts will expire. According to Bybt, this month’s expired contracts amount to around USD 5.4 Billion or 100,000 Bitcoins. This amount is way higher than the one in February, which amounted to USD 4 Billion. This expiration is a strong bullish indicator for BTC.
Still confused? Let’s make it easier, and check the charts back in February. We will see what happened to the prices of BTC when their options contracts expired.
In figure 1, we can clearly see how prices jumped after BTC option contracts expired. Currently, there is more interest in “call options” than in “put options”, which indicates that investors are bullish on Bitcoin. Will this scenario repeat this Friday for March 2021?
2- Tesla officially accepts Bitcoins as of Today
Remember back in January 2021 when Tesla purchased USD 1.5 Billion worth of Bitcoins? They also made a statement that the company would accept in the future Bitcoins as a form of payment for their cars. Well, today is the day of this official announcement. Elon Musk took to Twitter this updated news and said that Tesla company officially accepts Bitcoins as a form of payment. This bullish news also would entice other Big Tech companies to jump on the Bitcoin wagon, hence increasing demand for this cryptocurrency. Not only did Elon say that they will accept BTC, but he stated that the company would not sell them for fiat, but rather hold them…Major bullish news.
3- Strong Technical Indicators to drive Bitcoin UP
We already spoke about how price consolidations are usually a good indicator. Although Bitcoin prices might seem falling down since the 60K mark, we can see a clear triangle formation in figure 2, delimited by yet another very strong support price area of USD 53,500. Current prices sit around that support. If prices manage to break the upper triangle side, BTC prices should definitely gain momentum and push higher past that already broken 60K price. On the other hand, one must always plan for the worst, and a sensible SL area would be USD 50,000 and USD 47,300. Currently Bitcoin is extremely overbought and is set for a price breather, most probably when its prices break below the triangle in figure 2. This short-term adjustment though is normal, so buyers get ready.
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