Bitcoin has just reached a new all-time high. The currency has hit $121,000 and is now trading slightly above $122,000. This is a significant number, but some traders and analysts believe that this is not the end. In fact, they believe this is just the beginning of a much larger move.

Bitcoin Still Has Plenty of Room for Growth

There is a chart showing how Bitcoin typically grows over the years. It resembles a large tunnel where prices move up and down inside. Although $122,000 is a new record, Bitcoin is still near the bottom of that tunnel. Previously, when Bitcoin truly exploded, it moved to the top of that tunnel, and that’s when the crazy price surges occurred.

So, even though we are at the highest price ever, compared to the highs that Bitcoin has reached in previous bull markets, it may still be too early.

RSI Chart Appears Bullish

RSI stands for Relative Strength Index. This is a tool that tells us whether people are buying too much or selling too much.

When the RSI increases too high, it often means that the currency is overbought; too many people buying too quickly. This often signals that a correction is about to happen.

Currently, as Bitcoin analyst AO mentioned, Bitcoin's RSI is rising, but not too high yet. In fact, this slow and steady volatility of the RSI looks very similar to what we observed before the strong price surge in 2021. It shows that people are buying in, but the upward momentum may still have room. That's a good signal.

Many Traders Could Be Liquidated When Asset Values Exceed $120,000

This is when things get interesting. Some traders are betting that Bitcoin will decrease. They are using something called leverage, meaning they borrow money to bet against BTC.

Conversely, if Bitcoin rises, they will lose money quickly. If the price rises too high, they will be liquidated, meaning their trades will be closed abruptly. But that’s not the exciting part yet.

The liquidation of short positions can create a positive domino effect on the price, as that means BTC will be automatically bought to offset the shortage.

DaanCrypto, a well-known trader, shared a heatmap showing that many traders have trading volumes from $120,000 to $125,000. That area is filled with what we call liquidity clusters.

If Bitcoin continues to rise, all these traders could be liquidated. This will create additional buying pressure, pushing the price even higher, just like fueling a rocket.

Is This the Peak of Bitcoin Prices?

You might feel like you've reached a peak; after all, $122,000 is a huge number. But looking at these charts and signals, everything is not quite 'peak' yet.

The large price tunnel still has room for upward momentum. The RSI indicator is rising, but not too hot yet. And there's still momentum from liquidations. All of these suggest that this move may not be over yet. In fact, the biggest push is still ahead.

The BTC price chart shows the same thing. According to the trend-based Fibonacci extension indicator, BTC is currently trading above the important resistance level of $121,623. Once this level is broken, the possibility of the price rising to $136,000 also seems feasible.

A more optimistic target would be $160,000, which also seems feasible with this chart. However, a drop in price below $112,000 could invalidate the upward trend.