Bitcoin Price May See Correction Before Surging To $20,000 By Christmas, Analysts Suggest

KEY POINTS

  • Bitcoin could see a period of correction and consolidation after the price rally to $15,000
  • The uptrend could resume around Christmas
  • Political uncertainty and a weaker dollar could be the catalysts for Bitcoin’s next price milestone

As Bitcoin continues to trade around the $15,000 level, analysts are predicting a bullish long-term outlook for the benchmark cryptocurrency, but not without some corrections and consolidations.

Bitcoin closed Wednesday at $15,705, a new 2020 high, breaking the previous high reached six days earlier. But analysts are cautious about whether the trend will continue without hiccups. The Relative Strength Index (RSI) is now at the overbought level and the MACD is also predicting a correction. The volume recorded on Wednesday was also lesser than when Bitcoin first broke past $15,000 on Nov. 5.

Consolidation appears to be on the horizon for the benchmark cryptocurrency. Patrick Heusser, a senior cryptocurrency trader at Crypto Broker AG, said Bitcoin might consolidate between $14,000 and $16,000 in the coming weeks, Coindesk reported.

Chris Thomas, head of digital assets at Swissquote Bank, also forecasts a consolidation period before the price starts increasing again by Christmas.

Other analysts are predicting a correction of around 20%, which is based on a historical trend. In the past, whenever Bitcoin made a continuous increase in price, a 20-30% correction followed it before resuming the uptrend.

Many analysts said this uptrend could happen by the end of December with a target price of $20,000, Bitcoin’s all-time high. Macroeconomic factors, such as a weaker USD and the political uncertainty in the U.S., could be the catalysts for Bitcoin’s next run after hitting $20,000, the Coindesk report said.

If Bitcoin takes a breather, altcoins could find a moment to shine. Heusser added that a rally in altcoins could happen while Bitcoin takes a break. These altcoins suffered from the recent Bitcoin uptrend, as the benchmark cryptocurrency continued sucking out the volume from them.

The altcoin rally might have already begun, as Ethereum broke the multi-year resistance at $400 on Nov. 6. Still, the second-largest cryptocurrency must first break its 2020 high of $475, hit on Sept. 1, before a major price uptrend could happen.

Cryptocurrency exchange Photo: Getty