Bitcoin (BTC) outperformance above $ 50,000 this week is likely to continue well into the fourth quarter as psychological resistance becomes support during the next phase of the bull market, according to Chief Commodities Strategist Mike McGlone.
On Tuesday, McGlone released the October 2021 issue of the Bloomberg Galaxy Crypto Index, which provides an overview of where digital assets could head for the rest of the year. In the report, McGlone speculated that Bitcoin’s $ 50,000 resistance – a level that has proven impenetrable since dumping in May – is on the verge of breaking support.
“Bitcoin’s $ 50,000 resistance since May seems ripe to turn into crypto support in the fourth quarter,” he wrote, adding:
“We consider the $ 40,000 mark to be similar to the $ 10,000 Crypto launch pad from the fourth quarter of the 20th. The similarities are about 4x higher. The average price for 2021 is $ 44,500, and acceptance and demand are growing in the face of dwindling supply. “
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BTC price soared to $ 55,000 on Wednesday as a combination of technical, fundamental, and sentimental factors drove the cryptocurrency to multi-month highs. As Cointelegraph reported, Bitcoin is increasingly decoupling from the broader macro environment. Case in point, BTC’s 9% rally on Wednesday came when the Dow Jones fell more than 200 points and the US dollar gained 0.4% against a competing currency basket.
The McGlone report suggests that Bitcoin remains bearish compared to traditional stock market indices like the Nasdaq. “Rising stocks will keep Bitcoin’s beta high, but if the stock market falls, further incentives will strengthen the foundation for the digital reserve,” he said.
The report also has positive things to say about Ether (ETH), given the widespread adoption of DeFi, decentralized exchanges, and non-fungible tokens. For the Ether Prize, McGlone set a target of $ 5,000, arguing that the path of least resistance would be higher.