Referring to the report, Twitter commentator Alex, has stated that the direction pointed out by the Citibank’s subsidiary, and not the exact figure, should be given importance by traders as Bitcoin’s “price is likely to continue to go up, and a lot.”
Referring to Bitcoin as the gold of 21st century, Tom Fitzpatrick, initially views the long-term direction of Bitcoin’s price to be associated with steep “rallies followed by painful corrections.”
Interestingly, the time frame of bullish runs of Bitcoin has been on the rise. The first Bitcoin rally lasted for 10 months, from 2010 to 2011. It is followed by a two-year rally, from 2011 to 2013, and finally a three year rally, from 2015 to 2017.
On the contrary, Fitzpatrick has pointed out that the time span of correction following the last two price rallies has stood stable for roughly 12 months. This, as per the analysis, takes us precisely at the center of a bullish rally which began early last year and is likely to continue for another four years until the final leg of 2022.
It can also be argued that an extended rally could take Bitcoin to more new highs. By drawing a channel using long-term (seven year) prices Fitzpatrick was able to arrive at a price target of $318,000 to be attained in December 2021.
Citibank bitcoin technical analysis.
Target: Moon. pic.twitter.com/prB1YjVNhX
— Alex (@classicmacro) November 13, 2020
While acknowledging that the forecast looks highly unlikely, he has underlined the fact that this “would only be a low to high rally of 102 times (the weakest rally so far in percentage terms) at a point where the arguments in favor of Bitcoin could well be at their most persuasive ever.”
These price target is based on the assumption that the shift in the US Federal Reserve monetary policy that happened on the outbreak of Covid-19 pandemic has caused a huge and consistent rise in fresh money creation, with minimum aim to restrict the trend following the rebound of employment and economic activity.