Bitcoin’s price is finally gaining some bullish momentum following almost two months of correction. It seems that the bulls are looking to paint a new record high in the coming weeks, but will they make it?
Technical Analysis
By TradingRage
The Daily Chart
Bitcoin’s daily price action has been showing an apparent corrective behavior. The cryptocurrency has been making lower highs and lows since dropping from $75K. The gradual decline inside a descending channel shows the market was in a corrective phase rather than a full-on bearish reversal.
Yet, the price has finally broken above the channel’s midline and is on its way to test the higher boundary of the pattern. In case of a bullish breakout above the descending channel, market participants can finally expect a rally toward higher levels.
The 4-Hour Chart
Looking at the 4-hour timeframe, the price has recently broken above the midline of the descending channel and retested it. As a result, the market is currently targeting the $68K resistance level. A breakout above this area would likely result in a rally above the channel and toward the $75K all-time high.
With the RSI showing values above 50%, the momentum is bullish, and the mentioned targets seem achievable.
On-Chain Analysis
By TradingRage
Bitcoin Exchange Reserve
During the recent drop in Bitcoin prices below $60K, many investors have panicked and sold their coins to prevent heavy losses. This can be interpreted from the exchange reserve chart demonstrated here. It is evident that the metric has risen above its 30-day moving average, showing that many investors were depositing their coins to exchanges in order to sell them.
Yet, with the market rising back above $60K, the reserves have dipped again, dropping below the 30-day moving average and even making a new low. Therefore, it seems that investors are withdrawing their coins from exchanges, as they expect a longer price rally.
This behaviour can lead to a supply shock, and the reduced selling pressure itself could contribute to a further increase in BTC price and, potentially, a new record high.
