Despite Recent Downtrend, Analysts Predict Potential Upswing for Bitcoin
Summary:
Despite a 6.5% drop in Bitcoin's value over the last week, analysts predict a potential trend reversal towards an upward trajectory. This forecast is based on current technical setup, positive investor sentiment, and encouraging on-chain data. Bitcoin's price has fluctuated between $58,000 and $72,000 over the past ten weeks and is retesting a region that was previously a significant resistance point. Investor interest in buying Bitcoin has surged following the recent price drop, and data shows a decrease in Bitcoin's reserves on exchanges, suggesting investors could be anticipating a price increase.
Bitcoin's value has depreciated by 6.5% within the past week, trading at a 10% deficit from its highest record value of $73,835 hit on March 14. Despite this downtrend, based on the current technical setup and favourable onchain data alongside optimistic investor sentiment, Bitcoin analysts foresee a potential shift in trajectory towards significant upward momentum.
Information provided by Cointelegraph Markets Pro and TradingView indicates that Bitcoin prices have fluctuated between $58,000 and $72,000 over the past two and a half months following a retreat from new record highs. Analysis of Bitcoin's weekly trends shows the current price band is revisiting a region that previously presented formidable opposition when Bitcoin achieved record highs, as noted by well-known analyst Rekt Capital.
Rekt Capital suggests this region is now offering support to Bitcoin, given the current decreases in value haven't significantly dropped below this bracket. Another analyst, Moustache, presented similar findings, highlighting a BTC/USD bi-weekly graph that exhibits the price just above the 0.5 line (MZ BTC Bottom-Indicator).
According to this methodology, which uses the Elliot Wave Oscillator Method applied on Bitcoin's health trend, Bitcoin prices have retested this line three times in the past—in 2012, 2017 and 2020. In these instances, preceding record highs acted as scaffolds to Bitcoin's price which then surged exponentially, setting fresh all-time highs.
Market intelligence firm Santiment noted that the recent market correction incited Bitcoin investors to purchase more BTC, putting the cryptocurrency's local dips to keen advantage. Following Bitcoin's drop under $67,000 on June 13, investors exhibited the second-highest interest in purchasing Bitcoin within the last two months.
Data from Alternative – a platform that monitors sentiments related to Bitcoin – shows a progressive uptrend in the Crypto Fear and Greed Index, indicating a bullish outlook for the cryptocurrency among different investor segments.
Furthermore, onchain data analytics firm CryptoQuant revealed a 3.6% decrease in BTC reserves on exchanges over the past month, resulting in the lowest levels witnessed in five years. This suggests that investors may be transferring their tokens to individual custody wallets instead of selling, in anticipation of future value increments.
Published At
6/14/2024 9:30:00 PM
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