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Bitcoin’s Next Target is $55K: Is This a Good Time to Buy BTC?

Bitcoin's price action hinted at another bullish move after a period of price consolidation.

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While momentum has slowed down a little, Bitcoin (BTC) has grown in price by 1% over the past 24 hours, and its price action and on-chart indicators hint that the kingcoin isn't done with its current bullish run.

After smashing the $50k barrier, BTC has traded between the $50.8k to $52.5K price levels over a five day period. This has led to speculation that BTC buyers could be running out of steam and selling pressure could soon ensue.

However, these three price factors say quite the opposite:

BTC’s Price Action on the Shorter Timeframes

A look at BTC’s price action on the 1H and 4H timeframes revealed a strong price pattern for BTC’s bullish trend. The areas highlighted in the blue rectangles show BTC’s price action consolidating within a compact price range before breaking out on another strong upward move.

While past price action isn’t always an accurate prediction of future moves, BTC buyers could be poised to register another significant move after this current consolidation.

BTC/USDT on TradingView (4H Timeframe)

High Open Interest Rates

A high open interest is a strong indicator that the current market trend driving the price action is strong. As such, it hints at significant investor confidence that the current trend will continue.

A look at BTC’s Open Interest (OI) showed the prevailing sentiment was still bullish. Over the past day, the Open Interest rose by 2.31%, pushing BTC’s Open Interest above $14 Billion. Furthermore, the Funding Rate showed consistent money flow into Bitcoin futures. This suggested that investors and traders alike were opening more long positions in anticipation of a trend continuation.

BTC Open Interest | Source: Coinalyze

On-Chart Indicators

The Relative Strength Indicator (RSI) remained in bullish territory, above the neutral 50 mark. Also, the Chaikin Money Flow (CMF) stayed above zero to highlight the continued inflow of capital.

With BTC typically posting gains of 8-12% after a period of consolidation, a repeat of the same price action will take BTC to the $55k price mark in the short term. Thus, buyers can confidently expect to register gains on BTC from its current market price.

Disclaimer: This article does not constitute trading, investment, financial, or other types of advice. It is solely the writer’s opinion. Please conduct your due diligence before making any trading or investment decisions.