Bitcoin Price Analysis: BTC Soars Above Short-Term Key Resistance; Is $50k on the Way?
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Even in a risk-off environment, Bitcoin has outperformed global stocks, as investors wait to see if support at $40k will hold. After a month of liquidations and FUD, primarily from China, today's strong rally could signal the start of the next leg up for the primary cryptocurrency.
As we reported earlier this week, the 4-hour chart began to show flattening of near-term moving averages, indicating that consolidation was progressing and potentially paving the way for a breakout attempt.
BTC has been making higher lows and has begun to test the rising trend line at $44k. BTC pushed higher within hours, testing the next key resistance levels at $44.3k and $45.1k
BTC skyrocketed as shorts were squeezed out of their positions, with 539 BTC shorts liquidated in just one minute, sending BTC to $47k. As of now, BTC's rally has reached an intraday high above $48k, forming a higher high, implying that the Wave 2 correction has likely ended.
If the higher low at $40.7k was indeed Wave 2, the recent price action above $45.2k indicates that BTC is entering Wave 3, which is the most significant upward move. Given that these Elliot Waves are smaller in comparison to the larger wave counts, this bullish move could be the start of a strong impulse higher, potentially sending BTC back to the all-time high area – around $65k.
It is critical to wait until the daily close (midnight UTC) to see if the bitcoin price can maintain its gains. To form a higher high, the price must close above $45.2k. At the time of writing, BTC is also trading intraday above the 200-day moving average and the 21-week EMA, both of which are important levels in determining whether the bull market will continue.
On a weekly closing basis, reclaiming the 200-day moving average and the 21-week EMA will be a very bullish signal.
At $40.7k, On-chain was bullish
FUD and risk-off shook the market, but BTC on-chain metrics remained firmly bullish. Long-term holders and miners have continued to accumulate despite the 55 percent drawdown in May, ongoing liquidation events, and FUD. This behavior is consistent with previous Bitcoin bull markets, particularly the 2013 bull market, during which long-term holders and miners continued to accumulate.
Chart by CryptoQuant
Unlike in bear markets, where long-term holders and miners aggressively distribute after parabolic blow-off tops and bull traps, this year's 55% drop in May did not result in further distribution by these cohorts. This pattern clearly disproves the bear thesis, as all bear markets saw aggressive distribution from long-term holders and miners.
Spot exchange reserves have continued to fall in recent days, despite a sell-off in global markets and a rally in the US dollar. According to CryptoQuant's UTXO Age Distribution, younger coins continued to sell while older coins accumulated. Spot exchanges are down more than 15,000 BTC during the 3-week pullback, indicating a strong accumulation signal.
Is a Bullish Move on the Way?
With near-term technicals indicating significant improvement, a firmly bullish on-chain trend, and divergence from global stocks, BTC appears well-positioned for significant upside if significant accumulation and price follow-through higher continues.
At the moment, the bulls have reclaimed control. The weekly close will provide additional confirmation of the recent upward trend. Everyone's attention will be focused on $45.2k to confirm a higher high.
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DISCLAIMER: The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading cryptoassets comes with a risk of financial loss.
IMAGE CREDIT Featured Image via Unsplash
Cryptocurrency charts by TradingView.
Tag : # BTC #BTC Price #Bitcoin Price
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