Bitcoin price extends gains for the sixth day in a row and hit seven-week highs on Wednesday, with the token exceeding the 100-DMA which served as a resistance zone before. As the price maintains positive momentum, the next target now comes around the $9,000 handle but first, the cryptocurrency needs to make a clear break above the $8,500 area.
Many market observers and analysts have been citing the geopolitical tensions between the United States and Iran as the main bullish driver for the leading digital currency by market capitalization. It looks like that amid a widespread risk aversion, traders perceive bitcoin as a safe haven asset along with gold. As a reminder, last week, the US had killed Iranian general Qassem Soleimani in an airstrike. As the conflict keeps growing, Iran attacked Iraqi bases with US troops in retaliation for the general’s death. In response to the unfolding events on this front, traders shifted focus to safe-haven assets and bitcoin managed to capitalize on this driver as investors rushed away from the traditional high-yielding assets.
Also, traders are citing the upcoming halving as another bullish driver for BTCUSD due in May 2020. Ahead of this event, the hash rate continues to rise and reached another all-time high recently. It is widely expected that halving, which will cut miners’ rewards per block by half, will bring more demand for bitcoin due to a lower supply.
As bitcoin reentered the $8,000-area for the first time in 1.5 months, the short term technical outlook for the digital currency has improved substantially, as the price was stuck in a limited range below the $7,500 area. On the other hand, the inability to break above the $8,500 intermediate resistance could bring the pair back below the 100-daily moving average just below the $8,000 level. In this scenario, bitcoin could return to is previous channel amid profit taking after a decent rally. However, at this stage, the short term technical outlook for the token looks bullish.