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Bitcoin’s value has been steadily rising recently, maintaining its upward trend since the start of the year. Nonetheless, the market is presently at a significant resistance point, and its response will be crucial for the trajectory in the upcoming months.
Technical Analysis
By:Edris
The Daily Chart:
On the daily chart, the price has successfully exited the narrow consolidation range around the $28K level, vigorously approaching the $30K resistance. This point serves as both a vital psychological and technical resistance zone and is likely to influence the short-term outlook of the cryptocurrency market.
A breakout may lead to a bullish continuation towards the next major resistance area, situated near the $38K mark, while a rejection could result in a decline towards the 50-day moving average around the $26K level and potentially the $25K support zone.
Regardless, the bulls can maintain a positive outlook as long as the price stays above the 200-day moving average, which is a key indicator of bull/bear market conditions.
Source: TradingView
The 4-Hour Chart:
The 4-hour chart indicates that the price is having difficulty surpassing the $30K resistance level after bouncing back from the $28K support zone a few days prior.
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The RSI indicator also reveals a distinct bearish divergence signal, suggesting a possible consolidation or correction in the near term.
In this scenario, the $28K level could again be relied upon to support the price, while the $25K area might also be revisited in the event of a more significant correction. Overall, there are ample support levels, and the bulls may finally find some relief after nearly a year of a challenging bearish market.
Source: TradingView
On-chain Analysis
By: Edris
Bitcoin Short-Term Holders SOPR
Bitcoin’s price has been consistently climbing, and numerous investors who purchased at prices below $30K are now in profit. These holders are anticipated to realize at least a portion of their gains, and the SOPR metric supports this assessment.
The short-term holders’ Spent Output Profit Ratio (SOPR) is a valuable on-chain metric that gauges the ratio of realized profits by holders who acquired their coins within the last six months. Values exceeding 1 indicate profit-taking, while values below one suggest that investors are selling their coins at a loss.
It is clear that short-term holders who bought Bitcoin in recent months have been realizing profits at a rate comparable to that seen during the $69K all-time high range. While profit-taking is a typical behavior in a bull market, it could lead to a bearish reversal and even a continuation of the bear market towards lower prices if supply does not meet adequate demand.
Consequently, this metric should be closely monitored to ascertain whether the market is entering the initial phases of a new bull run or merely experiencing another bull trap.
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Disclaimer: Information found on CryptoPotato is those of writers quoted. It does not represent the opinions of CryptoPotato on whether to buy, sell, or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk. See Disclaimer for more information.
Cryptocurrency charts by TradingView.
