Bitcoin is holding well above critical support at $ 47,000. Trading at $ 50.067 with 1.6% in the 1 hour chart and sideways movement in the 24 hour chart, BTC appears to be on the road to recovery on the lower time frames. As many in the crypto space have said, this bull run will be defined by its periods of rapid rebound and consolidation.
Merchant Josh Rager compared BTC’s past price action with current price performance. For Rager is a normal part of a bull run for BTC to trend below its 100-day Exponential Moving Average (EMA). In 2017, the cryptocurrency saw at least 3 drops below this metric.
The trader believes investors should be “worried” if the price drops below its 200D EMA. In contrast, BTC never heads below this metric during bullish price action.
During the weekend, the trader expects a rebound if BTC falls in the middle of $ 40,000. Currently, the 10W EMA is converging with the weekly support level, as explained by Rager. This could serve as a good entry point for a long position in both BTC and altcoins, as the trader put it:
The bottom could be in it, but if Bitcoin bounces then goes down to $ 40k. I would love to buy both $ BTC and alts in this area. As long as the price holds, we could see some major rallies over the next few months as BTC slowly increases.
In the meantime, some side moves could be Bitcoin’s new normal in the near term. Lex Moskovski, CIO of Moskovski Capital, believes that the recent crash has “cooled” key indicators of BTC overheating.
As seen below, Moskovsky compares the 2017 bull run metrics with the current market and has determined that Bitcoin is around 44% potentially peaking on its uptrend. On the contrary, there could be even more upward momentum after this week’s crash. Moskovsky mentionned:
Bitcoin has cooled down a bit, and according to major overheating indicators it has even more benefits now.
What could be breaking the structure of the Bitcoin market?
Economist and trader Alex Krüger provided further arguments in favor of a long-term bullish case for BTC. As Krüger said, this cryptocurrency has seen massive adoption with favorable macroeconomic conditions. Since 2020, the thesis of Bitcoin as a store of value has gained a lot of strength among institutional investors.
Krüger presented two possible scenarios. In one case, the “main catalysts” are heating up the market and the price of BTC is entering a new period of discovery. The Economist mentionned:
The first half of this dump was expected, not the second, which focused on current events. Shit happens. But nothing major has changed except for a healthy cleanse. When you expect a good range, avoid turning bullish on the breakouts, or risk cutting your head off.
In the second scenario, the US government and its Treasury Secretary Janet Yellen are launching new regulations for crypto and digital assets. Krüger expects “draconian” rules to have a negative impact on the market.