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Bitcoin Bears Still In Control
Per a chart from industry analyst Jacob Canfield recently posted on Trading View, Bitcoin (BTC) bears are still in control of the market, in spite of the fact that cryptocurrencies are seeing strong fundamentals and technicals simultaneously.
As Canfield depicts in the chart below, Bitcoin has seen a “hidden trend line” develop since late-2015, which supported BTC during four drawdowns in the 2016 to 2017 run-up. However, during this bear market, that former key support level has turned into heavy resistance. Earlier this year, BTC tried to pass $4,400, but was rejected off that trendline, and last week, BTC tried its hand at pushing past $5,500. This move, as you know, failed miserably, with the asset seeing an immediate 10% pullback to $4,950 as a result of the rejection.
Thus, the analyst remarked that for Bitcoin to enter into its next bull run, investors will need to reclaim the trend line by convincingly surpassing $5,700 in the coming days and weeks. So in other words, until BTC breaks the trendline, which will head higher and higher with time, bears still have their hands on the cryptocurrency driving wheel.
Canfield isn’t the only one who thinks that Bitcoin isn’t home free just yet.
Cold Blooded Shiller, a cryptocurrency analyst, recently drew attention to the one-week Guppy, a collection of moving averages that aims to predict trends, resistances, and supports, for Bitcoin. And it wasn’t exactly all too pretty. While BTC’s 25% rally from $4,150 to $5,450 over the past two weeks allowed the asset to break out of the green band of the Guppy, the top (key resistance/trend reversal level) of the red band was rejected.
In fact, the wick to $5,450, in the eyes of Cold Blooded anyway, was a “beautiful bearish retest” in that it cements that BTC isn’t out of choppy waters just yet. Considering that the red band of the one-week Guppy acted as key support for Bitcoin in 2017’s rally, if BTC fails to break and hold past the red band, it may be that much harder to call for a bull run.
Isn’t Crypto In A Bull Run Though?
These analyses come as Tom Lee, the head of research at Fundstrat, has proclaimed that the ongoing Bitcoin bear market has recently come to a close. As reported by Ethereum World News on a previous date, the long-standing bull remarked that BTC’s recent rally past $5,000 was based on “true buying,” making it not an act of manipulation as some postulated. This is likely in reference to a Reuters report, which claimed that a single group or entity managed to purchase $100 million worth of Bitcoin across three exchanges, creating a short-term influx of FOMO that pushed BTC higher.
Furthering the bullish narrative, Lee looks to the 200-day moving average, which has acted as an overarching level of resistance for BTC since early-2018. The Fundstrat co-founder explains that while many proclaimed cryptocurrencies dead as a result of their -85% performance from top to bottom, BTC closing and holding above the aforementioned level confirms that it is “back in a bull trend.”
Photo by 贝莉儿 NG on Unsplash
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