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Bitcoin’s value has significantly increased over the past week, recording a rise of approximately 15%.
We examine some key technical levels and assess whether the rally holds any potential for the future.
Technical Analysis
By Shayan
Recently, Bitcoin achieved a notable breakout above the essential 100 and 200-day moving averages and exceeded its annual high at $32K, restoring bullish sentiment in the market. At present, Bitcoin encounters a considerable resistance area, indicating the possibility of a short-term correction.
The Daily Chart
Reviewing the daily chart, Bitcoin exhibited a significant upward movement after breaking through the critical resistance at $27K, which was highlighted by the convergence of the 100 and 200-day moving averages.
The remarkable surge persisted, ultimately surpassing the $32K resistance, a price level that corresponds with Bitcoin’s peak in 2023. Consequently, market participants pushed Bitcoin’s price closer to a notable resistance area at $35K, characterized by the 0.5 and 0.618 Fibonacci levels, establishing a new annual high.
If buyers successfully maintain this crucial level, it could potentially set the stage for a positive mid-term trend, with higher resistance zones as potential targets. Conversely, if a setback or rejection occurs, Bitcoin may enter a phase of consolidation correction marked by increased market volatility.
Source: TradingView
The 4-Hour Chart
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On the 4-hour chart, Bitcoin’s price underwent an extended consolidation phase, oscillating between the $25K and $32K levels. Following this, there was a strong upward momentum that drove the price beyond the upper limit of the range, achieving a new annual peak at $35K.
However, the price now faces significant resistance at $35K, highlighted by a substantial supply of Bitcoin. This resistance may temporarily hinder the upward trend and could potentially initiate a corrective phase. In this case, the subsequent support levels for Bitcoin would align with the price range corresponding to the 0.5 and 0.618 Fibonacci retracement levels.
Nonetheless, if buyers unexpectedly manage to overpower the sellers, a sudden breakout could occur, resulting in a strong price increase. Regardless of the outcome, it is vital to closely monitor price movements in the upcoming days, as the market may experience heightened volatility.
Source: TradingView
By Shayan
Bitcoin has been steadily on an upward path since the start of 2023, demonstrating a general uptrend. Most recently, after a consolidation period within the range of $25K to $31K, the price reached a new annual high at $34K, fostering optimism among market participants.
The NUPL (Net Unrealized Profit/Loss) metric, shown on the chart, serves as an important indicator, acting as a measure of the proportion of investors currently in a profitable position.
Recent changes in the NUPL metric are significant. Following a marked uptrend, the metric is currently nearing the 0.5 level, identified as the Belief-Denial Phase (Orange), indicating that a larger segment of investors is currently experiencing profitable returns.
This reflects a widespread optimistic sentiment in the market. However, it is important to recognize that despite the prevailing bullish sentiment, the eventual realization of these profits may introduce short-term volatility to the market.
Source: CryptoQuant
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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.
