Bitcoin Price Analysis: BTC Up 1.8 Percent, Path to $4,500

 
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It is documented that blockchains that utilize proof of work as their consensus algorithm are power intensive. However, this is necessary and because power equals to expense, running any SHA-256 full node is a major expense in these mining farms.

Read: Will Bitcoin Still Dominate the Crypto Space in 2019

While there are steps taken by authorities to satiate demand from these necessary infrastructures, the search for cheap power continue, and there is no better location to set up rigs than in abandoned factories of the former Soviet state. Most breakaway countries are tolerant of new technology, and with Ukraine especially leading the way, the State of Abkhazia has cut off 15 mining farms from the country’s electrical grid.  The step is not permanent but a necessity to guarantee supply to important national facilities, homes and other social institutions.

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With biting winter temperatures, Chernomorenergo said in a Facebook post that the demand from these facilities equaled 8,950 kWT—enough to power 1,800 households.

“As of December 31, 2018, the resolution of the Government of the Republic of Abkhazia “On temporary measures to limit the consumption of electricity by certain categories of subscribers”, has been implemented. All identified “cryptocurrency mining farms” are disconnected from the power supply system. A total of 15 facilities were disconnected with a total capacity of 8950 kW / h. This is equivalent to the consumption of 1,800 households or equal to the consumption of the Sukhumi district. I would like to note that during the events the owners of these objects showed understanding and participation.”

Bitcoin (BTC) Price Analysis

At spot prices, Bitcoin (BTC) is up 1.8 percent in the last day and stable in the last week against the USD. Still, we shall retain a bullish outlook all thanks to the events of the week ending Dec 23. Notice that despite recent lower lows, bulls are well positioned, and after bottoming out at $3,200, the surge up and above $4,000 was strong and accompanied by decent volumes.

Besides, days after prices found support at $3,200 and expanded as shown by Dec 17 bull bar, consequent bear bars did push prices below $3,500. Then again, attempts of these lower lows are met by strong bull participation as Dec 28 bull bar shows.

Combining all these signals, then it’s clear that bulls are in charge and as long as prices are trending above the lower limit of our trade range at $3,600 or Dec 28 lows, bulls have a chance. Ideally, we recommend bulls, but for assurance, bulls must first build enough momentum and rally past $4,100. After that, traders can buy on dips in lower time frames with first targets at $4,500, $5,000 and even the most crucial resistance level of all, $6,000.

This is our BTC/USD trade plan:

Buy: $4,100

Stop: $3,900

Target: $4,500, $5,000

All Charts Courtesy of Trading View

Disclaimer: Views and opinions expressed are those of the author and aren’t investment advice. Trading of any form involves risk and so do your due diligence before making a trading decision.