Why Analysts Think Bitcoin Corrects After Surge to $15,000

Bitcoin has undergone a strong surge since the lows of the week around $13,200. As of this article’s writing, the leading cryptocurrency trades for $15,100, slightly below the $15,300 daily highs but far above the aforementioned weekly lows.

The leading cryptocurrency is up around 6% in the past 24 hours as the U.S. dollar continues to tumble lower. The U.S. Dollar as the election has swung in Biden’s way, which many believe will lead to a further devaluation of the currency that if President Trump was re-elected.

Despite this underlying macroeconomic trend, there are some that think Bitcoin corrects from here.

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Bitcoin Could Drop From Here, Analysts Say

Bitcoin has a good likelihood of dropping from here, analysts say after the rapid move to $15,100.

One crypto-asset analyst shared the chart below after BTC hit $15,300, noting that the cryptocurrency just hit a monthly pivot. This is important because the last five out of seven times BTC interacted with monthly pivots as it did now, it saw a pullback of 10-30%. 10% below Bitcoin’s current price of $13,500 while 30% below BTC’s current price is $10,500.

Commenting on the chart, the analyst who shared it stated:

“5/7 of the last times $BTC came into contact with the monthly R1 pivots it saw a pullback.”

Of note, Bitcoin doesn’t crash every time it runs into a monthly pivot level. As can be seen, in October, the cryptocurrency exploded past the previous monthly resistance at $12,000 to $13,000 in a single daily candle. It could do the same now, especially if the buying volume that has been seen over the past few days continues to roll in.

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Chart of BTC's price action over the past few months with analysis by crypto trader HornHairs (@Cryptohornhairs on Twitter).
Source: BTCUSD from TradingView.com
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Maybe Not

Driving this rally is the U.S. dollar dropping. USD is again dropping due to expectations of a Biden presidency, which should result in a large stimulus bill that would end up driving down the value of fiat currency.

Further expectations of stimulus could end up driving Bitcoin higher instead of triggering a retracement as some expect. How this plays out, though, remains to be seen.

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Price tags: xbtusd, btcusd, btcusdt
Charts from TradingView.com
Why Analysts Think Bitcoin Corrects After Surge to $15,000