Bitcoin’s recent 15% bounce brought some relief to the investors, but is it important to look at the bigger picture? The short-term gains are encouraging, but Bitcoin still has some challenges ahead. There are key indicators to keep an eye on, and analyst Crypto Capital Venture discussed these in detail.
The focus is mainly on the weekly chart, which provides a clearer view of Bitcoin’s long-term trend. Despite the attention on short-term movements, the analyst remains confident in Bitcoin’s long-term potential.
Whales Spark Renewed Hope:
One big reason for this prediction is the accumulation of Bitcoin by large holders, known as whales. These investors are buying up Bitcoin like never before, which suggests something big might be coming. Over 358,000 Bitcoins were moved to long-term holders in July, and this trend continued into August, with over 44,000 Bitcoins added in just the past 30 days.
This buying is happening quietly, without an immediate price spike, which is typical in markets. Often, these bullish signs appear when there is a lot of fear in the market, as shown by the current Fear and Greed Index, which is around 34.
What’s Happening With The Technicals?
On the weekly chart, Bitcoin is holding above a crucial support level that lines up with the 50-week moving average. This support looks strong, and while there’s always a chance of a drop, the analyst is hopeful that Bitcoin could bounce back from here.
The analyst also points out a possible inverse head-and-shoulders pattern forming on the weekly chart, which is a bullish sign that has been developing for years. If this pattern is confirmed, it could signal a major breakout for Bitcoin, similar to previous cycles.
Bitcoin has revisited a crucial area on the chart, similar to what happened in the last cycle. Back then, Bitcoin fell through the 20-week moving average, which many feared could signal the start of a bear market. However, it found support at the 50-week moving average and then moved higher, which was a positive sign.
Conclusion:
What’s even more encouraging is that Bitcoin is much earlier in its cycle now compared to when it last fell through the 20-week moving average. This early consolidation could be a strong indicator that Bitcoin is setting up for another bull run. Looking ahead, Bitcoin might test the lower trend line again, which could lead to more sideways or choppy movement. He’s also watching for Bitcoin to test key moving averages, particularly around the $61,000 to $64,000 range, where there’s significant resistance.