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Following a prolonged phase of consolidation, Bitcoin’s price has effectively breached the significant $30K resistance threshold. Nonetheless, it is crucial to proceed with caution in the market, especially in the near term.
Technical Analysis
By: Edris
The Daily Chart
On the daily chart, Bitcoin’s price has shown a swift upward trajectory over the past week, bouncing strongly from the $25K support level. The resistance at $30K has been surpassed, and the price is striving to hold above this level.
However, the RSI indicator currently indicates an overbought situation, implying a potential correction. Should this happen, the 50-day moving average may serve as a support level around $27,500, followed by the 200-day moving average in the vicinity of the $25K area.
Source: TradingView
The 4-Hour Chart
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The 4-hour chart presents a comparable scenario to the daily chart, showcasing a robust upward movement and the breaking of resistance levels. The recent surge began after the breakout from the descending channel, driving the price to new highs above $30K.
Nonetheless, caution is advised due to a distinct bearish divergence noted on the RSI indicator. This suggests the likelihood of consolidation or a correction in the near future, urging investors to stay alert.
Source: TradingView
Bitcoin Long-term holder SOPR
Following Bitcoin’s recent surge, numerous holders who had been facing losses for several months are now in a position to sell and secure profits.
The Long-term holder SOPR metric, illustrated in the chart alongside a 100-day moving average, represents the ratio of profits or losses realized by long-term holders. Values exceeding 1 indicate profit-taking, while values below 1 reflect losses.
The chart clearly indicates that long-term holders, who had been incurring losses for nearly a year, have started to sell at a profit due to the recent price increase. While this development is not inherently detrimental, it could elevate the supply of Bitcoin, and without adequate demand, it may lead to a potential price decline.
Source: TradingView
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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.
