The Royal Bank of Canada (RBC), Canada’s largest bank, stated that it is taking into consideration the deployment of a cryptocurrency trading platform.
The platform would allow users to conduct transactions of digital assets, including Bitcoin and Ethereum, along with using their digital assets for online and in-store purchases.
The Bitcoin price, however, has not reacted to this positive news. In fact, it has been gradually decreasing since the rapid upward movement on Oct 25. But, the current pattern suggests that it will soon break out and initiate another rapid upward move.
Crypto trader @smartcontracter stated that Bitcoin could increase all the way to $12,000.
@Smartcontractor outlined a pattern in place since the move on Oct 25. A breakout could see BTC shooting for a major resistance zone around the $12,00 which was created between June and August of this year.
Let’s analyze this movement and see if a breakout is actually likely.
Since making the aforementioned upward move on Oct 25, the Bitcoin price has been trading inside a descending wedge.
It has reached the support line several times and in doing so, recently created a bullish Doji.
Furthermore, this is a minor support area, created by the previous resistance area in place throughout October.
Finally, the significant bullish divergence in both the RSI & MACD makes it likely that the price will break out.
Bitcoin Eyes $12,000 Target
Looking at the daily time-frame, we can see that the Bitcoin price has validated the previous resistance line and is using it as support. This is a very common movement after a breakout that suggests further upside.
However, there are three significant resistance areas, found at $9,600, $10,900 and $12,000. It is likely that any one of these zones could reverse the price for a certain time period.
Therefore, while it is likely that the $12,000 target will be reached, the increase might not be a straight line as presented in @smartcontractor’s tweet.
Rather, a more gradual upward move characterized by retracements once the price reaches the outlined resistance areas is expected.
Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.
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