BitcoinBTC(Traders are experiencing one of the most rapid capitulation events in the past few years, since the end of 2022. However, one analyst claims that data from the past confirms the $80,000 bottom.
The key takeaways
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Bitcoin analyst has given a 91% chance that BTC is not going to close at the weekly lows.
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NVT Golden Cross indicated that Bitcoin’s value may be underestimated and signaled short-term opportunities to take long positions.
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Macroeconomic liquidity signals from Arthur Hayes and rapid onchain recovery supported the $80,000–$85,000 floor.
BTC’s capitulation has reached a low-probability level.
Bitcoin Analyst Astronomer said The ongoing negative sentiment has been conveyed by “wait for the trend,” The timing of the bull-cycle conclusion or any claim to the contrary is wrong.
A capitulation volume model, which is based on the layered Rule-of-3 for weekly candles identified previous cycle bottoms by identifying three consecutive red high-volume candles that printed prior to major reversals.
This same pattern of capitulation has consistently produced the same results in 11 historic instances. Bitcoin has rallied 35% in two of the 11 instances.
Eight of the 11 times the pattern was followed by a fresh leg upwards, leading ultimately to new highs. One occurrence led to a sustained decline, which is the statistical anomaly.
The forecast shows a 91% probability of $118,000 at current prices. A 99% likelihood of $112,000 and 75% of the bull market continuing.
The Astronomer emphasized that the true trap is sentiment; waiting to confirm the trend or selling immediately aligns with the cautious behavior of the crowd and risks chasing after the next high.
The BTC NVT golden cross is currently at -1.6. This indicates a market that has been undervalued and offers a chance for reversion to the mean. Darkfost, a crypto trader has said that the market is undervalued and a short-term mean-reversion opportunity exists. warned In the current climate, leverage is not recommended.
Related: Strategy stock is bleeding, but Saylor ‘won’t back down’ from Bitcoin bet
Arthur Hayes “I think $80,000 holds” As liquidity increases
Cointelegraph reported Arthur Hayes maintains that BTC’s recent 35% decline to $80.500 represents the cycle bottom, citing a near-term end of the Federal Reserve’s quantitative tightening cycles and an increase in US bank loans.
Hayes is expecting a better liquidity situation as the year progresses. “rising-tide effect” Cryptography is a good example. “We chop below $90K, maybe a stab into the low $80Ks, but $80K holds,” Hayes argued that the next phase will be driven by liquidity expansion and not sentiment.
The narrative was supported by data from Onchain. CryptoQuant data noted The market has almost instantly turned positive after BTC registered its largest realized net loss since the FTX crash.
Such fast absorption of forced sellers implies that the floating supply has been flushed, enabling BTC to defend the $80,000–$85,000 zone if traditional market conditions remain stable.
Related: Bitcoin rallies as US dollar strengthens: Are crypto traders walking into a trap?
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Source: cointelegraph.com
