After the recent surge in bitcoin price and the successful break above the important $30,000 resistance level, the market is now going through a period of consolidation. However, noteworthy signals appear during this stage.
Technical Analysis
Written by: Idris
daily chart:
On the daily chart, the price has repeatedly tested the $30,000 level since breaking above it recently. While this level has so far provided support, there are worrying signs in the form of bearish divergence seen in the RSI.
This indicates the possibility of a correction or reversal in the near term. In the event of a decline, the 50-day and 200-day moving averages at $28k and $26k respectively could act as significant support levels.
Conversely, if the price continues its bullish momentum, then a move towards the $38,000 resistance area becomes a reasonable scenario.
4 hour chart:
On the 4-hour chart, the price has shown erratic and unexpected movements in recent weeks, which makes it difficult to determine its future direction. The $30,000 level is being tested again, and a potential breakdown could lead to a decline towards the $27,500 level.
The RSI has been relatively flat, hovering around the 50% mark, indicating no clear dominance from buyers or sellers. The ongoing battle near the critical $30,000 region is adding to the short-term uncertainty in the market.
On-chain analysis
Written by: Idris
Bitcoin exchange reserve
The recent upward movement in the price of bitcoin has sparked debates about whether market participants are selling their coins for a small profit or choosing to hold them for a longer period.
By analyzing the Bitcoin exchange reserve metric, which tracks the amount of BTC held in exchange wallets, we can gain insight into investor behaviour. An increase in this metric indicates that investors are depositing their coins on exchanges, potentially intending to sell them. On the contrary, the decline indicates that investors are withdrawing their bitcoins from the exchanges, indicating a preference to hold their coins for a long time.
Recent data shows a significant drop in the Bitcoin exchange reserve measure over the past month. This decline indicates a bullish trend among market participants, as they expect further price increases and tend to hold on to their coins.
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