Crypto heaven! As Bitcoin price skyrockets, bulls eye $51,000 mark

Bitcoin price rally over the last few days has bulls once again eyeing levels the coin hasn’t seen since the start of the year.

Bitcoin, which was on the downtrend up until the last few weeks, has now reached its highest value since the start of the year. (REUTERS)

Bitcoin price rally over the last few days has bulls once again eyeing levels the coin hasn't seen since the start of the year.  The largest cryptocurrency by market value rose nearly 4% at one point Monday, reaching $47,881. That's its highest level since the start of the year and the propulsion rounds out its year-to-date gains to around 3%. Elsewhere, the MVIS CryptoCompare Digital Assets 100 index -- which tracks tracks the performance of some of the largest digital assets -- was up more than 5% as of 12:04 p.m. in New York.

Bitcoin and other cryptocurrencies had been, up until the last few weeks, mired in a similar downtrend as other riskier assets, like U.S. stocks. But a weekend rally above $45,000, a key level watched by chartists, helped garner momentum for a bigger breakout. The coin has added 15% over the past week. 

“It's been a choppy start to the year, not just for crypto, but across all asset classes. So I think certainly, it's an exciting morning in the crypto community to see that year-long, so far, of losses erased, and also seeing Bitcoin break out above that psychological $45,000 level,” Michael Sonnenshein, CEO of Grayscale, said in a Bloomberg TV interview. He added that “what we're seeing is a couple of native crypto buyers like Terra buying for their own reserves,” which could help support prices. 

Do Kwon, the co-founder and chief executive officer of the firm behind the Terra blockchain, confirmed that it has purchased more than $1 billion in Bitcoin since the end of January, Bloomberg News reported on Monday. Analysts are also pointing to other developments for the renewed optimism around crypto, with some citing comments by U.S. Treasury Secretary Janet Yellen, who said in a March 25 interview with CNBC that despite her own skepticism about the asset class, “there are benefits from crypto and we recognize that innovation in the payment system can be a healthy thing.”

The rally has brought Bitcoin into technically overbought levels, based on its Relative Strength Index (RSI) score of 71. Assets are considered overbought if its RSI crosses above 70 and oversold if it falls below 30. Overbought levels tend to bring out projections for a short-term breather, though strategists at Bespoke Investment Group say it's not always been the case that those conditions lead to a downturn and can instead portend further gains. 

Matt Maley, chief market strategist at Miller Tabak + Co., says he's looking at Bitcoin's 200-day moving average, which is currently around $48,270 -- that could provide some short-term resistance. But beyond that, chartists will be focused on $50,000 “because it's a big round number.” He's also looking at $51,000, which represents a late-December high. 

Bitcoin remains about 30% below the record high of around $69,000 reached in November.