Convergence of Bitcoin's Average Prices Signals potential Breakout Amid Rising Bank Insolvencies
Summary:
Bitcoin's price might be nearing a significant juncture as its average prices over three periods - 5-day, 30-day, and 50-day - have coalesced, signaling a potential remarkable movement. According to cryptocurrency analyst, Jamie Coutts, this pattern suggests low volatility and indicates a possible breakout or retraction. Currently, Bitcoin is considered a "Strong buy," trading above its three Simple Moving Averages at $70,840. The report also notes an increase in the number of US banks facing potential collapse. The data does not provide investment advice.
Bitcoin (BTC) seems poised for a significant price decision, as the average prices over three different periods converge. This unusual situation suggests a potential significant price movement, according to Real Vision's lead cryptocurrency analyst, Jamie Coutts, who noticed this phenomenon on June 4. He pointed out Bitcoin’s average price over three short-term durations, all within a 5% difference.
On June 4, the Simple Moving Average (SMA) - a measure of the average past prices over a given time window - showed an alignment across three spans: 5-day, 30-day, and 50-day periods. All these intervals were within the range of $65,000 and $68,239. To analysts, this indicates a prolonged period of low volatility and raises expectations for a potential breakout. However, the closely consolidated prices may also result in a price retraction.
According to the Moving Average Indicator provided by TradingView, Bitcoin stands as a "Strong buy" at present. This analysis considers both the SMA and the Exponential Moving Average that gives more significance to recent prices. Presently, Bitcoin trades above its three SMAs at $70,840, data from CoinMarketCap indicates. Trading above the moving average signals bullish sentiment among traders, indicating that the moving average may turn into Bitcoin’s new support level.
On the same day, Bitcoin momentarily hit $71,040 before dropping, a critical price mark anticipated by traders as the next milestone towards reaching its record high of $73,679. Over the past 30 days, Bitcoin succeeded in staying above its critical support level of $60,000. Yet it couldn't surpass $72,000, touching a maximum of $71,946 on May 21.
While it's uncertain where Bitcoin’s price will go next, Coutts highlighted the rising number of U.S. banks on the verge of failure during the first quarter of 2024. The Federal Deposit Insurance Corporation (FDIC) disclosed on May 29 that the number of banks on its "Problem Bank List" - which monitors financial institutions at a high risk of insolvency - surged by 21% in the first quarter of 2024, totaling 63 banks. After the collapse of three banks - Signature Bank, Silvergate Bank, and Silicon Valley Bank in March 2023, Bitcoin experienced an upswing of 35% over nine days, hitting $27,050.
This report doesn't provide investment advice or recommendations. Every trade or investment carries some degree of risk, and readers are urged to carry out their own research prior to making any decisions.
Published At
6/5/2024 5:45:40 AM
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