Bitcoin hovering near $50,000, what's next?

Bitcoin is rather predictable when it comes to technical analysis and usually meets traders' expectations. The level of 48,178.13, that the price broke through on Friday, has been serving as support for three days in a row. Moreover, BTC/USD has reached the psychological level of $50,000 per token. And this is good news for those who are waiting for bitcoin to develop further bullish momentum and return to all-time highs.

According to on-chain analysts, almost 90% of all bitcoin holders in the market are trading in the positive territory. And a rise in the price of the main cryptocurrency prompts the development of the digital coin.

Network data shows that about 70% of bitcoin addresses gained profit in June. Today this number has grown, and the average market entry is currently $45,000.

In the meantime, Santiment data shows that bitcoin price closely correlates with the development activity on Github. Now development activity of the main cryptocurrency is returning to its May values. At the same time, the price is approaching an all-time high of $65,000. But the market seems to be a little overheated now.

Does this mean that we should expect a downward correction?

From the technical viewpoint, the price has precisely tested the indicated levels which means that the local support at $48,178.13 is quite strong. Yet, the nearest technical resistance is found around $52,000 per coin. It is also likely that consolidation will take place within this channel. This is exactly what happened in the previous sideways channel. This means that BTC/USD can pull back from the reached level of $50,000.

A deeper correction is possible if the price breaks through the 48,178.13 level. Then a return to the sideways channel of 44807.24 - 48178.13 is very likely although a negative news background is required for this.

In the meantime, the fundamental background looks quite favorable. The good news today came from PayPal which announced its plans to expand its cryptocurrency services outside of the US. The payment system will allow UK citizens to buy cryptocurrency from their accounts.

At the same time, crypto experts see the new victory of bitcoin as a reason to remind the market about its far-reaching goals. McGlone announced that the main cryptocurrency, along with gold and long-term bonds, will show significant growth and become the market leader in the second quarter of 2021.

This week, market participants are waiting for the Jackson Hole Economic Symposium. The dollar's reaction to the Fed's stance on the monetary policy could affect BTC/USD as well. Although the market can be unpredictable sometimes, the technical picture provides a clear scenario, albeit with a slight fluctuation between the levels.

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The material has been provided by InstaForex Company - www.instaforex.com

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