Historic day for Bitcoin that surpasses $20,000

Julien Moretto – 16 Dec 2020

Over the last seven days, the price of Bitcoin has risen by a further 8% to €16,500, or more than $20,000 for the day on December 16, which will mark the history of the asset. Since December 1st, its price has been fluctuating in a range of $2,000, between $1,600 and $1,600. A price action that resembled a flat consolidation after the sharp rise in October and November. The odds remained in favor of a continuation of the upward trend, which has just materialized with the breakout of the $1,600 that generates a new upward thrust in the price. Be careful, however, we are approaching January, which has often been a very mixed month for Bitcoin’s performance. We will see in our analysis the key price levels to intervene, even if a correction was taking place.

This strength in price action could be explained by sustained purchases by institutional investors. In addition to Square, Grayscale and MicroStrategy, more and more investment professionals have recently announced that they are starting to put a portion of Bitcoin in their portfolios, often driven by their clients’ awareness of asset performance. The American insurer MassMutual is one of these newcomers. Two discourses predominate: one is based on the argument that Bitcoin is seen as a volatile asset, but that it provides better performance than traditional assets and allows one to diversify one’s portfolio, and the other is increasingly seeing Bitcoin as a protection against fears of rising inflation and a weakening dollar.

Nothing very specific on the side of altcoins, still mostly correlated to Bitcoin. A more significant correction should be noted on XRP , after its sharp increase in recent weeks and following an airdrop that concerned XRP holders.

  • According to CoinGecko,market capitalization is climbing back to the $580 billion level.
  • Bitcoin’s dominance gained some ground at 62.7%, up from 62.3% last week.
  • The best performance of the top 50 is to be attributed to UMA with +31.6% over one week.

We invite you to discover our analysis in video (in french and dated from December 15) :

Bitcoin (BTC)

Coinhouse’s recommandation:
Hold / Buy on breakout

  • Bitcoin is traded around €16,100 ($19,600) on December 16. Volatility has declined since the beginning of the month. The price is clearly consolidating. Is it an accumulation to continue with a new bullish wave afterwards, or a distribution to start a bigger correction? Impossible to know at this stage. The first key price level to intervene is: €16,200 ($19,800). A daily close above this price could be interpreted as a buy or strengthen signal. However, we remind you that new purchases here always carry a high risk since we are on an annual resistance level. Beware in particular of the 16,300 to 16,700 ($19,900 to 20,400) zone, which could be a selling zone that would cause the bullish breakout to fail and the beginning of a further correction.
  • Conversely, another price level that should catch your attention is the €14,500 ($17,600). If we end a day below this price level, we will have to prepare for a deeper correction, with large support zones at $16,200 or even $14,000 which will be possible opportunities for medium/long term purchases.

Ethereum (ETH)

Coinhouse’s recommandation:
Hold / Buy on breakout

  • Ethereum (ETH) is still correlated with Bitcoin. It earns 6% over a week to rub at €488 ($594). His price also moves in a range between €442 and €510 ($540 and $623). It is necessary to end a day above $623 to have a new buy signal on Ethereum and aim for a continuation of the rise towards the price zone of €590/670 ($700/800), on which profits should be taken. A bearish break of $540 will be a sell signal and we will wait for the lower price, at $490 and then $450 to eventually buy back in the medium term.

Litecoin (LTC)

Coinhouse’s recommandation:
Sell

  • Litecoin (LTC) is also benefiting from the good market trend and earns 5.6% at €67.50 ($82.60) over the week. But in the long term, Litecoin has suffered more since the sharp market decline last March linked to Covid. The asset is currently in a potential sales area of €70 ($85). The idea is to take advantage of a corrective movement that would bring the price back to a pivotal zone around €53 ($65). Depending on the price action and the overall state of the market, this zone will be interesting to reposition oneself for buying.

Tops & flops of the week (top 50 marketcap)


Tops

1- UMA : +31%
2- Kusama (KSM): +20%
3- Ziliqa (ZIL) : +20%


Flops

1- XRP : -19,5%
2- Huobi Token (HT) : -5,5%
3- OMG Metwork (OMG) : -3,5%

In this article, all information is given for information purposes only, even if it has been established from serious and reputable sources. It does not constitute an offer by Coinhouse to buy or sell digital assets, or an offer to provide services on digital assets, nor does it constitute advice, encouragement or a recommendation to operate on the digital assets in question. It constitutes simple information over which the user retains absolute control. We inform you that if you choose to invest in digital assets, you must be aware of our general terms and conditions of sale (https://bit.ly/2FGW2ek) and accept the various risks listed and defined on our legal warning page (https://bit.ly/3c4sQKc).

Become an informed investor!

Subscribe to our newsletter and catch the best bits of crypto selected by our analysts

Your email is secure, you can unsubscribe at any time.