Potential Bitcoin Forecast Target at 23,340 says Julius Baer Analyst

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The price of Bitcoin has made another attempt at going back to the hallowed $20K mark over the course of the past 24 hours, but ultimately failed. However, a technical analyst at a noted Swiss private bank says technical studies are advocating for further gains and traders should stay 'long' on the asset.

"Buying interest quickly took control after last Thursday’s 9.7% decline. This not only indicates strong demand but also confirms the momentum bottom displayed in the chart. A break above the 20,000 level is likely to accelerate the uptrend," says Alexis Chassagnade, Technical Analyst at Julius Baer.

"Key resistance levels are located at 21,080, 21,780, 22,500, 23,340, and 24,730. Due to the fact that momentum is firmly bullish, we recommend going long with a stop at 17,950 and a potential target at 23,340," says Chassagnade.

Joshua Mahony, a market analyst at IG says the $20,000 hurdle "feels like the last bastion, where a break higher could bring about a renewed sense of bullish optimism for Bitcoin holders."

One Bitcoin is currently quoted at 18956 dollars in midweek trade, while it is at 15698 euros and 14127 pounds, according to the multi-currency pricing provided by Kriptomat.io.

"Cryptocurrencies have been hitting the headlines once again, following a fresh record high for Bitcoin some three-years on from its prior peak. However, for those admiring Bitcoin’s seemingly insatiable run towards $20,000, today also provided a reminder of just how volatile Cryptocurrencies can be after an 8% decline in just two hours," says Mahony.

There is a great deal of commentary in financial circles regarding Bitcoin's relationship with gold, with some saying the cryptocoin is offering a similar store of wealth as that offered by gold.

"The non-fiat battle for supremacy has shifted towards the new just how the power of tech has dominated the more old fashioned stocks over the course of the year. While the bitcoin/gold ratio looks set for a rare decline today, it is likely we will continue to see bitcoin win out after the ratio hit a three-year high this week," says Mahony.

"Bitcoin and Ethereum both managed a full recovery to the recent highs and Bitcoin even managed a brief test to all-time highs just short of 20,000 before pulling back a bit overnight. The crypto space is garnering enormous attention on the recent run-up in the price and the contrast with gold’s stumbles is glaring as the debate rages on whether crypto assets can prove a better store of value than precious metals," says John J Hardy, Head of FX Strategy at Saxo Bank.

Yet while Bitcoin and other cryptocurrency peers have been engaged in a strong rally of late, gold prices seem to be engaged in a short-term downtrend. The positive correlation between cryptocurrencies with stock markets suggests a 'high beta' which makes this more of a 'risk on' asset, as opposed to being seen as a traditional safe haven.

Therefore, should the market continue to rally we would expect Bitcoin to gain. What will be interesting is the cryptocurrencies response to an notable 'risk off' episodes when true 'store of value' assets would be expected to shine.