Bitcoin’s (BTCThe rally of $76,000 to the dollar has revived investor optimism, however onchain data indicates that it may be a part of a recovery in its early stages, characterized by periods of volatility.
The following is a list of GlassnodeBTC has reached a new price level. “open” Between $72,000 and $8,000, there is less resistance.
This range can be defined in particular by the UTXO Realized Price Distribution. (URPD) which shows the exact location where the investor accumulated his coins. The momentum will allow BTC to move freely within this range in the short-term.
Glassnode said that the more accurate indicator is whether or not the market as a whole has returned to profitability. Bitcoin’s profit share has increased to about 60%. This level is often observed in the initial stages of recovery. Glassnode also added:
“A sustained push above 75% would carry considerably more weight as a confirmation of early bull market conditions, whereas continued rejection near current levels would reinforce the bear market recovery narrative.”
The market’s reaction to current selling pressure is also important. Bitcoin surged above $74,000 and short-term traders began to realize profits in a rapid pace. They were able to achieve gains of upto $18,4million per hour.
The same behavior was seen during earlier rallies that failed, when investors bought into the strength and slowed down the momentum. Bitcoin could rally to $78,000-$82,000 if it can absorb and hold this profit-taking wave.
Related: Bitcoin tests old 2021 top as gold falls to six-week lows under $4.7K
The trend indicator is still in place “bear” Market territory
Technically, there is still a tendency to caution. Bitcoin is still trading within lower highs/lower lows patterns on the daily and weekly timeframes. This indicates that no bullish market structure exists.
BTC’s price must sustain above $97.855 in order to make a positive shift.
It also coincides with Fibonacci “golden zone” Between the 0.5-0.618 levels of retracement, traders track this area as an important decision point when reversing trends.
If the price breaks above this range and then consolidates, it will indicate a high demand, increasing the chances of a rally on a longer-term basis.
CryptoQuant’s cycle indicator This cautious outlook is echoed by. Bitcoin Bull Bear Cycle remains in the bearish zone, although it has improved from -1 to -0.72 earlier this month. However, this is still far from confirmation of a trend reverse.
To confirm a bullish market, the indicator must move over 1, indicating a sustained upward trend.
The bull-bear average 365 day moving is at the moment -0.23. This move should be watched for an early warning. This level is a filter for long-term trends, as it smooths out volatility in the short term and highlights whether market conditions have shifted to bullish of bearish at the larger timeframe.
Related: Bitcoin ETF inflow streak snaps with $164M outflows amid BTC dip
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Source: cointelegraph.com
