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- Bitcoin is not yet in "overbought" territory and could reach $75,000 before the current bull cycle ends, Kraken says.
- According to historical price movements of bitcoin, the first quarter of 2021 could be met with massive gains for the token.
- Bitcoin is up 62% year-to-date as of Friday as it hovers just below $48,000.
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Bitcoin could gain much higher before the current bull market ends based on historical price movements, says a Kraken Intelligence market report published Friday.
Although bitcoin is quickly approaching resistance, it remains several tens of thousands of dollars away from entering into "overbought" territory, Kraken said. If bitcoin were to surpass $75,000 in the next few months, historical price action suggests bitcoin would then be close to the top of the cycle.
The cryptocurrency has pulled back from its all-time high above $58,000 on February 21, but it still finished the month 37% higher. The coin is up 62% year-to-date as of Friday as it hovers just below $48,000.
According to Kraken, bitcoin is now trending in a manner most similar to the first quarter of 2013, bitcoin's best first quarter on record. If the trend continues, the first quarter of 2021 "could be a historic quarter with a relatively outsized return."
"By plotting a logarithmic growth curve that connects BTC's prior market cycle tops (resistance) and bottoms (support) and by making assumptions about how severe BTC will correct upon hitting a cycle high, one will find that BTC likely has plenty of upside before entering a bear market," the report says.
The report comes as some investors voice concerns that bitcoin's rapid acceleration is a clear sign the cryptocurrency is in a bubble waiting to burst. Michael Burry said the coin is a "speculative bubble that poses more risk than opportunity" in a tweet Monday that has now been deleted.
On Wednesday Kraken CEO Jesse Powell told Bloomberg a $1 million as a price target within the next 10 years is "very reasonable."
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