Bitcoin prices have rallied over the last few days, coming close to $55,000 and then retracing slightly, managing to keep most of their latest gains.
The digital currency rose to $54,813.03 this morning, according to CoinDesk data.
At this point, the cryptocurrency was up 11% from the intra-day low of $49,390 it hit yesterday, additional CoinDesk figures show.
After climbing to within a few hundred dollars of $55,000, the digital asset experienced a modest decline, but was trading near $54,000 at the time of this writing.
When explaining bitcoin’s latest price increases, analysts repeatedly emphasized the continued influx of notable investors like financial institutions and major companies.
“We continue to see larger players making their way into the space in 2021,” said Joel Kruger, cryptocurrency strategist at LMAX Digital.
Marc Bernegger, a board member of Crypto Finance Group, offered a similar perspective.
More specifically, he claimed that one major reason bitcoin was able to once again reach a $1 trillion market capitalization is “growing demand from big investors allocating funds into digital assets for the first time.”
“Besides the participation from larger institutional investors there are more and more notable purchases from big corporations which are including Bitcoin in their treasury,” he added.
“The fact that the price of Bitcoin recovers after every dip in recent days indicates a steady buying pressure in the market and a sustainable support,” said Bernegger.
“I would not be surprised to see a new all time high soon,” he concluded.
Key Technical Levels
As for where bitcoin prices might go next, several market observers offered their perspectives, outlining important levels of support and resistance.
“Bitcoin has broken out of its recent trading range of $47,000 - $52,000 to the upside,” said Jon Pearlstone, publisher of the newsletter CryptoPatterns.
“The next key resistance levels are near the $58,000 all time high,” he stated, adding that $65,000 would come next.
“If we see strength above $65,000, much higher targets are possible,” said Pearlstone.
“With the investment community now well aware of Bitcoin, strength of volume now becomes a key indicator,” he emphasized.
“Volume is stronger today but still not convincing so traders need to watch for a price reversal with stronger volume which would likely take Bitcoin back inside it's recent trading range under $52,000 with support at $47,500 an $42,500.”
Kruger also weighed in, stating that “As far as levels go, we would highlight the current record high and $60,000 as the next key levels of resistance for bitcoin.”
“On the support side, there’s not a lot to talk about until down in the $43,000 area,” he added.
Disclosure: I own some bitcoin, bitcoin cash, litecoin, ether and EOS.
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