Bitcoin (BTCUSD) Nudges Towards the $100K Mark as Trump Media & Technology Group (DJT) Is in Discussions to Buy Digital Asset Marketplace Bakkt (BKKT)

Bitcoin (BTCUSD) will likely remain on watchlists Wednesday as the largest cryptocurrency by market capitalization nudges towards the $100K mark.

Key Takeaways

Bitcoin (BTCUSD) is set to remain in focus on Wednesday as the largest cryptocurrency by market capitalization edges closer to the $100K mark.

On Tuesday, Bitcoin hit a new record high above $94,000, before easing slightly to around $92,000 at the beginning of Asian trading. The cryptocurrency has now risen by about 35% since Donald Trump’s election victory amid optimism that the incoming administration will introduce policies that benefit the asset class.

Sentiment was also boosted on Wednesday by a report that the president-elect's Trump Media & Technology Group (DJT) is in talks to acquire digital asset marketplace Bakkt (BKKT). Additionally, options trading began on Blackrock's (BLK) iShares Bitcoin Trust, giving investors another way to hedge and speculate on the asset's price.

Below, we'll use technical analysis to examine Bitcoin's chart more closely, identifying key price levels to watch as the cryptocurrency's post-election rally continues.

Volume-Backed Rally Accelerates

Bitcoin's price move has accelerated after decisively breaking out above the psychological $70,000 level earlier this month.

Notably, the legacy cryptocurrency has registered its highest trading volumes since mid-March in recent weeks, indicating buying activity from larger market participants, such as institutional investors.

While the relative strength index (RSI) confirms bullish price momentum with a reading above 70, the indicator also suggests overbought conditions that could herald near-term dips.

Let's turn to the chart to identify a measured move price target and two key support levels that may be on investors' radar screens during pullbacks.

Measured Move Price Target

To project a potential price target, investors can use a measured move, also known as the measuring principle.

We apply this technique to Bitcoin's chart by measuring the percentage move of Bitcoin's trend higher from October 2023 to March this year and adding it to the lower trendline value of the cryptocurrency's recent eight-month trading range. For instance, we apply a 180% increase to $55,000, which would indicate an upside target of $154,000.

We chose this prior trending move as it also followed a multi-month trading range in the cryptocurrency.

Key Support Levels To Monitor

During profit taking, investors could be watching the $70,000 level closely. This area on the chart would likely attract buying interest near this month’s breakout point, which also roughly coincides with the prominent November 2021 peak.

Finally, further selling could see Bitcoin drop to around $55,000, a region where the price may encounter support from the recent trading range's lower trendline.

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As of the date this article was written, the author does not own any of the above securities.