Bitcoin’s price has been consolidating between the $20K and $24K levels over the past two months after a rapid decline from the $30K level. The $17K-$20K support area has held up well, pushing the cryptocurrency higher towards the $24K resistance in many cases but has so far failed to overcome it.
Currently, the price action suggests that Bitcoin may eventually break above this significant level to the upside, which could pave the way for a rally towards the $30K supply zone. The 100-day moving average is currently at the $26K mark and is likely to provide some resistance. Conversely, in the event of a bearish pullback, the 50-day moving average – currently sitting at $21K – will likely act as support.
In the 4-hour timeframe, after the price is rejected to the downside for the third time, the bear continues to try to push the flag pattern higher. However, a short bullish flag pattern seems to be forming and the price is currently breaking above it. The flags are continuation patterns and a bullish breakout from the bull flag could initiate another rally towards the upper trendline of the larger pattern.
Price is likely to break above it. Additionally, the RSI indicator is still oscillating around the 50% figure. This indicates that the bears or bulls are not in control and the momentum is in a state of balance. The outlook is likely to change after the weekend.
The market seems to be finding direction, but the big players are still standing. Following Powell’s speech and the Fed’s decision to raise interest rates in recent weeks, Bitcoin’s price has risen above its “realized price,” a critical threshold to hold the price.
Consequently, to cross the realized price level again, large volume and tremendous selling pressure is required. The MVRV indicator makes it easy to track the price of Bitcoin relative to its realized value. It shows how the cryptocurrency rose last week from the low value zone. However, despite the rapid rise from the indicated area, the 365-day moving average shows room for another substantial shakeout based on previous cycles.
Therefore, before a major bull run, another leg down is likely given the current market confusion and uncertainty and the current recessionary state in the global economy.
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