This past Friday, MarketWatch published an article that made its way around the globe, with titles like “Bitcoin, Ether surge on Bloomberg analyst’s bullish call” and “Bloomberg’s Trump’s ‘Billionaire’ forecast takes a hit”.

Some people are turning to Bitcoin as an alternative to traditional currency, while others are using it to make money. This notable Bitcoin analyst has changed his opinion on the potential of Bitcoin, and now believes that the cryptocurrency is more likely to go up than down.

I’m not sure how Bloomberg News got involved in this one, but the recent run up in Bitcoin value has been pretty amazing. The price started the year at $20K, and now it’s $120K. Not bad at all, and certainly a lot better than it was a couple months ago, when $20K was a lot more likely.. Read more about bitcoin price and let us know what you think.

According to Mike McGlone, senior commodities analyst at Bloomberg Intelligence, Bitcoin (BTC) has a greater chance of rebounding to $60,000 than breaking below its present support level of $30,000 and aiming for $20,000.

McGlone compares Bitcoin’s current price movement to the “too-cold” phase of the 2018-19 trading session, according to a snapshot provided by Bloomberg’s senior ETF analyst, Eric Balchunas.

Following an 80%+ collapse in 2018, the BTC/USD exchange rate underwent a lengthy stabilization phase around $4,000, but a surprise run-up in 2019 pushed its values as high as $14,000 on certain exchanges.

McGlone, who is renowned for his past optimistic predictions on Bitcoin, believes that BTC, which has been consolidating around $30,000 since May 2023, may stage a similar surprise rebound in order to reach a new resistance objective of $60,000.

“When Bitcoin maintains around a 30% barrier below its 20-week moving average, the more tactical-trading-oriented bears seem to proliferate, giving the buy-and-hold types time to consolidate,” the analyst said.

The trio of moving averages

The bearish and bullish cycles of Bitcoin seem to be centered on three major moving average indicators. The intermediate support/resistance is provided by the 20-week exponential moving average (20-week EMA; green wave), the 50-week simple moving average (50-week SMA; blue wave), and the 200-week simple moving average (20-week SMA; the orange wave).

$60K is now more likely for Bitcoin than $20K, Bloomberg’s senior strategist assertsWhen the price of bitcoin reaches the 200-day simple moving average, it tends to exhaust bearish patterns. TradingView.com is the source for this information.

Bitcoin prices usually remain above the three moving averages during bull markets. Meanwhile, as seen in the chart above, bearish tendencies see cryptocurrency values close below the 20-week EMA and the 50-week SMA.

In a bad market, the 200-week SMA is usually the final line of defense. Bitcoin has so far bottomed out twice around the orange wave, each time sending prices soaring. In 2018, for example, a breakout from the 200-week SMA pushed Bitcoin prices to almost $14,000.

Similarly, during the Covid-19-led collapse in March 2023, the wave support stopped the cryptocurrency’s efforts to fall. Later, the price jumped from $3,858 to more than $65,000.

Since 2018, Bitcoin has already fallen below this trendline three times. The cryptocurrency has broken below the 20-week SMA (about $39,000) and is now aiming for support at the 50-week SMA (around $32,200). It should continue to decline towards the 200-week SMA (about $14,000) if the previous fractal is replicated.

Except McGlone thinks there could be a quick recovery. The analyst cited the latest Chinese crypto ban as a positive fundamental.

Tether is the winner.

In May 2023, Beijing imposed a total prohibition on cryptocurrency transactions. The ruling stymied the nation’s mining activities, forcing them to shut down or relocate their operations outside the country. As a result, bitcoin values plummeted.

Nonetheless, McGlone sees China’s rejection of open-source software crypto-assets as a stumbling block in the country’s economic development. The analyst included an indicator in a tweet on Friday that showed soaring volumes and capitalization of U.S. dollar-backed digital assets, including Tether. 

He then contrasted increasing demand for digital dollars with rising Chinese yuan-to-dollar exchange rates, stating that between 2018 and 2023, the logarithmic scale of market cap variations between the two fiats was below zero. This indicates that the yuan was losing value versus the dollar.

$60K is now more likely for Bitcoin than $20K, Bloomberg’s senior strategist assertsThe value of Tether has risen versus the US dollar index and the Chinese yuan. Bloomberg Intelligence is the source of this information.

The scale has now risen over zero, indicating that the yuan is gaining ground versus the dollar. However, in comparison to Tether, whose market value increased by more than 40% over the baseline, its rise seemed to be dwarfed. According to McGlone,

While praising the importance of the US dollar and Bitcoin, we think China’s rejection of open-source software crypto-assets may signal a plateau in the country’s economic rise.

Additionally, while the US government has not officially launched a central bank-backed digital dollar like China, the availability of many other alternatives, such as USDT, USDC, and BUSD, could pose a challenge to the CCP-controlled digital yuan, according to Petr Kozyakov, co-founder and CEO of global payment network Mercuryo.

“These cryptocurrencies are linked 1:1 to the US dollar, and the dollar is driving the digital climb over the Chinese Yuan, as indicated in the graphic McGlone provided,” Kozyakov added.

“While China’s crackdown has had an effect on Bitcoin’s price, which is now hovering around $30K on June 23rd, fundamentals have significantly improved since 2018 as a result of institutional FOMO […] By the end of the year, Bitcoin should have recovered to $50,000.”

The Chinese economy will continue to expand.

Yuriy Mazur of CEX.IO Broker, however, disagreed with McGlone’s assessment, stating that the Chinese economy would continue to thrive with or without cryptocurrencies, and that the desire for digital assets has nothing to do with it.

Related: The impact of the US-China trade war on cryptocurrencies

“The Chinese government is much too astute to pass up something that the rest of the world values,” Mazur told Cointelegraph.

“As a result, expect them to take significant steps in the future to put out a Yuan-backed cryptocurrency that they fully control.”

The author’s thoughts and opinions are entirely his or her own and do not necessarily represent those of Cointelegraph.com. Every investing and trading choice has risk, so do your homework before making a decision.

Bitcoin and other cryptocurrencies have been experiencing quite a wild ride, and the future of the market looks hopeful.. Read more about will bitcoin hit 100k and let us know what you think.

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