After a powerful rally that pushed Bitcoin (BTC) over the $31,000 stage, the most important cryptocurrency by market capitalization has misplaced its bullish momentum and retraced to its earlier consolidation stage of $28,400. The retracement has been accompanied by a decline in buying and selling quantity and a lower in market sentiment, which has led some buyers to query the sustainability of the latest uptrend.
Is The Bull Trend In Jeopardy For Bitcoin?
According to the dealer and analyst underneath the pseudonym “CJ,” Bitcoin has confronted weak spot throughout its day by day highs, indicating a possible reversal in its bullish development. This has put strain on bulls, who at the moment are carefully monitoring the value motion to establish key help ranges that should maintain to keep away from an extra worth decline.
One such help stage is the $27,700, which has acted as a powerful help ground for BTC. If the value had been to interrupt beneath this stage, it might sign a shift in market sentiment and doubtlessly result in an extra decline in worth. According to CJ, if BTC fails to push greater from this stage, it could possibly be on the cusp of a major correction because the lows of 16k.
Furthermore, CJ advises that buyers, whether or not in a protracted place or not, ought to hold a detailed eye on the bearish worth motion throughout the 4-hour and 12-hour Fibonacci Volume Zone (FVG). This zone represents a possible resistance space the place Bitcoin might face promoting strain and doubtlessly reverse its bullish development.
If a bearish worth motion is about up inside this zone, CJ suggests it could possibly be a possibility for buyers to enter a brief place. On the opposite hand, if Bitcoin manages to shut again above the $29,980 stage, CJ believes that the cryptocurrency could possibly be off to the races, indicating a possible continuation of its bullish development.
Is Not All Bad News For BTC
CryptoCon, a distinguished cryptocurrency analyst, has urged that it could by no means see a lot decrease Bitcoin costs than $28,000 ever once more. This assertion is predicated on the VWAP (Volume Weighted Average Price), a technical indicator that measures the typical worth of Bitcoin over a sure interval, weighted by its buying and selling quantity.
BTC VWAP Ratio. Source: CryptoCon on Twitter.
According to CryptoCon, Bitcoin has simply damaged above the VWAP, a bullish sign suggesting a possible reversal within the present development. As lengthy as this breakout is sustained within the quick time period, CryptoCon believes that earlier market cycles point out that the one factor that would take Bitcoin again beneath $28,000 is a black swan.
On the opposite hand, CryptoCon has identified that whereas Bitcoin has risen 1000’s of {dollars} with out experiencing a wholesome pullback, the three Week Bollinger Bands nonetheless point out {that a} return to the higher band is probably going at present at $35,790, as seen within the chart beneath.
BTC’s 3-week Bollinger Bands. Source: CryptoCon on Twitter.
According to CryptoCon, earlier market cycles have proven that there have been no massive corrections till the higher band was reached, so if CryptoCon’s evaluation is right, it might recommend that Bitcoin is coming into a brand new section of its market cycle, which might doubtlessly result in additional worth and investor curiosity enhance.
BTC is buying and selling at $28,400 on the 1-day chart. Source: BTCUSDT on TradingView.com
Featured picture from Unsplash, chart from TradingView.com
