Bitcoin (BTCUSD) soared above $100,000 for the first time late Wednesday as investors bet that the incoming Trump administration and Congress will support policies that benefit the cryptocurrency market. 

Wednesday's rally followed news that President-elect Donald Trump named crypto enthusiast Paul Atkins to lead the Securities and Exchange Commission (SEC). Atkins would replace crypto critic Garry Gensler, who said he would step down in January.

Bitcoin was recently trading at $103,000, up from around $95,000 before news of the SEC nomination. Since the election, Bitcoin has surged more than 45% as investors bid up the digital asset on expectations of more crypto-friendly policies.

Below, we take a closer look at the technicals on Bitcoin’s chart and point out important price levels to watch out for.

Pennant Pattern Breakout

With its move above $100,000, Bitcoin has broken out above a newly formed pennant, a chart pattern that signals a continuation of the legacy cryptocurrency’s current move higher.

It’s also worth pointing out that the 50-day moving average (MA) crossed above the 200-day MA back in late October to form a golden cross, a bullish signal that underpins the cryptocurrency’s strong uptrend.

While the relative strength index (RSI) confirms bullish price momentum with a reading above 70, the indicator also flashes overbought levels, increasing the chances of near-term profit taking.

Let’s now use technical analysis to project a bullish upside price target as Bitcoin moves into price discovery and also identify several key support levels to monitor during dips.

Measured Move Bullish Target to Watch

Amid Bitcoin's move into price discovery, investors can use a measured move, also known as the measuring principle, to project a potential price target.

This technique works by calculating the impulsive move higher that preceded the pennant and adding that amount to the pattern’s top trendline. In this case, we add $32,430 to $97,500, which forecasts a bullish target of $129,930.

Key Support Levels to Monitor

A wave of profit taking could see Bitcoin’s price fall to around $90,500, a location on the chart that may find support near the pennant pattern’s low and a period of brief consolidation in mid-November.

Selling below this level may bring the $80,500 region into play. This area, currently sitting just below the upward sloping 50-day MA, could attract buying interest near the closing and opening levels of two bullish candlesticks last week.

Finally, a more-bearish decline could lead to a retest of major support around $70,000, an area where investors would likely seek entry points near the prior trading range’s top trendline. This location could also find support from the 200-day MA as the closely watched indicator continues to rise.

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As of the date this article was written, the author does not own any of the above securities.

CORRECTION: This article has been updated with the correct day of bitcoin's move above $100,000.