Bitcoin prices recently climbed over 5% in less than 24 hours, breaking through $11,500 earlier today on CoinDesk.
While this particular price point was described by one trader as “the most important level” for bitcoin, the simple fact that the digital currency rose above $11,500 cannot be interpreted as “the start of a bull run,” said Joe DiPasquale, CEO of cryptocurrency hedge fund manager BitBull Capital.
[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
Jesse Proudman, CEO of crypto hedge fund Strix Leviathan, offered a similar point of view.
“Bitcoin’s bounce off its March lows, bolstered by the eye-popping performance of other large-cap cryptos certainly has the initial indications of the beginnings of a broader bull market,” he stated.
However, “the real test will be if Bitcoin can break both $12,000 and $13,000, posting higher highs over the preceding market rallies in 2019 and 2020.”
Jon Pearlstone, publisher of the newsletter CryptoPatterns, also weighed in, looking at some key price levels.
“While Bitcoin’s current move higher above $11,500 is another bullish sign, for now it’s primarily a move higher retest of the weekend spike high of around $12,100,” he stated.
“How price and volume reacts if it reaches $12,100 – $12,500 will be important,” Pearlstone emphasized.
“If Bitcoin can break the key resistance level of $12,500, then the next target will be the prior cycle high around $14,000,” he stated.
However, “if price falls from that $12,500 range, first support would be $10,500” and then “long-term key support” would be at $9,500.
Fortunately, both of these levels “held up well in Bitcoin’s most recent ‘flash crash,’” he noted.
Disclosure: I own some bitcoin, bitcoin cash, litecoin, ether and EOS.