Bitcoin price looks bullish here, despite the dip below $50,000 from a week ago. The market formed a double bottom and bounced back, now struggling to break above the neckline of an inverse head and shoulders pattern.
The entire cryptocurrency market bounced on the back of Bitcoin’s recovery. The market also found relief on the back of Tesla’s earnings call.
When Tesla bought Bitcoin in the first quarter of the year, it invested about $1.5 billion in the digital asset. This week’s earnings announcement revealed that Tesla is a major hodler – it only sold about $101 million worth of Bitcoin, hodling the rest. On top of that, it keeps accepting Bitcoin as payment for its electric vehicles.
Furthermore, Tesla announced that the only reason why it has sold Bitcoin was to test the market liquidity. In other words, it wanted to see how long it will take to convert the Bitcoin from its balance sheet into fiat liquidity?
Bitcoin Price Technical Analysis
The chart below suggests Bitcoin has a chance at a new all-time high, providing the market holds the support given by the projected neckline. Bulls may want to wait for the price to break and hold above the neckline, before going long. A stop at the projected neckline and a risk-reward ratio of 1:2 should be enough for conservative traders. Aggressive traders may target a new all-time high.