Chart Wars: As Companies Continue Crypto Adoption, Are Bitcoin And Ethereum Headed For A Bullish 2022?

Benzinga · 12/27/2021 20:48

Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETH) were trading slightly higher on Monday propelled by both a return of bullish sentiment in the cryptocurrency sector and upward momentum in the overall markets, where the SPDR S&P 500 (NYSE:SPY) was flying up over 1% higher into blue skies.

Despite many crypto enthusiasts hoping the apex cryptos would end the year at all-time highs, with some analysts giving Bitcoin and Ethereum price targets of over $300,000 and $12,000, respectively, by the start of 2022. Ultimately, Nov. 10 marked the top for the cryptos so far in 2021.

Earlier in the year, a six-week-long downtrend, led Bitcoin and Ethereum to reach a bottom mid-September and reversed course into uptrends that could renew hopes of a bullish first-quarter of 2022.

It should be noted, however, that events affecting the direction of the general markets can quickly invalidate patterns, especially in the historically volatile crypto sector. As the saying goes, "the trend is your friend until it isn't" and any trader should have a clear stop loss set for their positions and manage their risk versus reward.

In The News: MicroStrategy (NASDAQ:MSTR) CEO Michael Saylor said recently he believes businesses that provide access to Bitcoin will be the most profitable over the next ten years. Over the course of 2021 a number of public companies have pivoted their business model to include cryptocurrencies in some form. AMC Entertainment Holdings, Inc (NYSE:AMC) CEO Adam Aron told CNBC during an interview on Dec. 20, the theater chain’s inclusion of cryptos is part of its transformation strategy.

See Also: Used Cars Appreciating Faster Than Stock Market, Even Some Cryptocurrencies: Report

The Bitcoin Chart: On Monday, Bitcoin was attempting to break up from a bull flag pattern on the daily chart, with the pole created between Dec. 20 and Dec. 24 and the flag formed between Dec. 24 and Sunday.

  • Monday’s price action caused Bitcoin to print a higher high above the Dec. 20 high of $51,878.60, which confirms the uptrend is still intact.
  • If the crypto closes the 24-hour session near its high-of-day it will print a bullish Marubozu candlestick, which could indicate higher prices will come on Tuesday.
  • Bitcoin has resistance above at $52,666 and $55,625 and support below at $50,505 and $48,475.

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The Ethereum Chart: Ethereum has been trading in an uptrend since Dec. 15 when it reacted bullishly to a double bottom pattern at the level, when paired with the price action on Dec. 13 where it bounced from the area.

  • On Dec. 23, Ethereum broke up bullishly from a pennant pattern, but the crypto was unable to make a significant move higher due to lower-than-average volume on the break.
  • Ethereum will need to make a higher high above the Dec. 23 high of $4,157.82 otherwise the crypto may form another pennant pattern, making lower highs and higher lows until either big bullish or big bearish volume comes in to break it from the pattern.
  • Ethereum has resistance above at $4.168.56 and $4,384.43 and support below at $3,949.45 and $3,610.91.eth_dec._27.png