The price of Bitcoin (BTC) tested $10,000 a complete of 5 times within the past 11 days. the worth action are often considered as a bullish or a bearish trend supported varying perspectives. The quintuple test of a key psychological level at $10,000 are often analyzed in two ways: The $10,000 resistance level is getting weakened with every test, or the resistance is so strong that buyers aren’t ready to escape of it.
Many top crypto traders believe that the mid-$9,000 area may be a start line to a replacement extended rally to the $14,000-to-$15,000 resistance range and with $20,000 as a medium-term target. Others foresee a large pullback to the $7,000-to-$8,000 region first, before Bitcoin’s price can aim for $14,000 then plan to break the record high.
The short-term, bullish scenario for Bitcoin
Traders who expect the worth of Bitcoin to reclaim the $10,000 resistance level as support and see a rally to key levels above it predict that the resistance area was weakened with multiple spikes to the $9,800-to-$9,900 range.
Bitcoin tests the $9,900–$10,000 resistance range five times in 11 days. Source: Tradingview
Traders still debate whether the present price trend of Bitcoin the beginning of a bullish uptrend following the highly anticipated block reward halving on May 11. Fundamentally, the block reward halving may be a highly optimistic event for Bitcoin’s price because it directly affects the availability of BTC, because it halves the quantity of Bitcoin mined, decreasing the speed , at which new BTC is produced and, subsequently, what proportion is sold on the market.
Historically, the halvings of 2012 and 2016 both resulted in a minimum of a 2,500% increase in price. Hence, the bullish trajectory of BTC is that the halving will push the worth of Bitcoin forward in both the short-term and therefore the long-term.
According to cryptocurrency researcher Philip Swift, an indicator called the 2-Year Moving Average Multiplier shows BTC reached its bottom at $3,600 and broke out of a multi-year trendline at $5,800. At a macro level and during a more long-term scenario, Swift noted that the indicator suggests subsequent reasonable target for BTC is that the all-time high of $20,000. Swift tweeted:
“$BTC has been super bullish since it broke out above the 2yr MA. We got our chance to accumulate below it b4 the hedge fund guys got all excited about Bitcoin. Next stop now the 2yrMA x5 [over $20,000].”
Bitcoin price with 2-Year MA multiplier. Source: Philip Swift
Similarly, Bitcoin trader Nunya Bizniz said Bitcoin is showing a “golden cross” at a time frame, which has only happened seven times in Bitcoin’s history. The last golden cross was triggered when BTC was hovering at around $5,000 in early 2019 when it recovered from a plunge to $3,150. Bizniz tweeted:
“BTC Golden Cross (GC): GC = 50dma moves above 200dma. There have been 6 occurrences. Of those, only one has occurred while the 200MA is rising. A 7th GC is about to occur with a slight rising gradient in the 200MA.”
A golden cross typically indicates the beginning of an extended bull trend. However, the danger is that BTC’s price could potentially drop below this cross point when it happens, which then makes it a death cross with a bearish structure.
The seventh golden cross in the history of Bitcoin forms. Source: Nunya Bizniz
For most of the macro bullish trends of Bitcoin to stay intact, BTC has got to remain above $9,000 over subsequent week and still retest the $10,000 resistance level. The positive sentiment among professional traders also coincides with the moving average convergence divergence, or MACD, indicating a further upside on a weekly Bitcoin price chart.
Bitcoin weekly price chart with MACD. Source: Satoshi Flipper
With Bitcoin remaining above $9,000, cryptocurrency investor referred to as “Light” emphasized that the sentiment around Bitcoin among top traders is usually positive, tweeting:
“I am yet to run into a single competent trader/investor who is bearish on Bitcoin in this current moment. And those who are long are bullish with conviction. In hindsight it’ll either look incredibly obvious, or it’ll turn out that we’ve all run grossly ahead of ourselves.”
With Bitcoin remaining above $9,000, cryptocurrency investor referred to as “Light” emphasized that the sentiment around Bitcoin among top traders is usually positive, tweeting:
The bearish Scenario for Bitcoin over the next few weeks
If the optimistic predictions on Bitcoin revolve round the positive effect on the worth of BTC a halving can have, negative projections also primarily revolve round the halving. within the previous two halvings, Bitcoin’s price dropped after the halving, and therefore the real uptrend didn’t initiate until 8–12 weeks after the halving.
The tendency of Bitcoin to fall after a halving combined with the failure to interrupt out of the $10,000 resistance level following five unsuccessful attempts has fuelled most bearish predictions for BTC. Bitcoin trader referred to as TraderXO said during a tweet that BTC’s price is probably going to drop to the low-$9,000s within the near-term, with the mid-$8,000 region as a lower area of support.
Bitcoin price range based on its price action since early May. Source: TraderXO
Based on market data, approximately 72% of the Bitcoin futures exchange is taking an extended position. meaning the overwhelming majority of traders expect Bitcoin’s price to travel up. While this is often typically a positive piece of knowledge , it also exposes the likelihood of an extended squeeze.
Across BitMEX, Bitfinex and Binance Futures, there’s about $716 million worth of active longs. In contrast, only $273 million worth of shorts is filed. the massive discrepancy between longs and shorts decreases the probability of a brief squeeze and increases the likelihood of a deep pullback.
Variables outside of price action
The fundamentals of Bitcoin like on-chain activity, liquidity and sentiment slightly declined after the halving. Liesl Eichholz, the top of growth strategy at Glassnode, wrote:
“Bitcoin on-chain fundamentals dropped slightly in Week 20. GNI registered a 1 point decrease over the week, pushing its overall assessment of the Bitcoin ecosystem to 73 points. This downturn was mainly driven by the Network Health subindex, which decreased by 8 points.”
The minor decrease in overall liquidity and sentiment was mainly caused by a decline in interest toward Bitcoin pre- and post-halving. Before the event, the amount of transactions on the Bitcoin blockchain network and activity across various platforms increased.
Considering the pre-halving hype, Eichholz emphasized that the slight drop by fundamentals isn’t necessarily a negative indicator. A positive factor, however, is a rise within the number of addresses holding quite 0.1 BTC, or around $970.
Bitcoin has the image of a currency that’s widely owned by whales — i.e., individual investors who hold an outsized portion of the asset’s supply. However, data shows that the distribution of the availability of BTC has improved, with more people owning BTC. Rafael Schultze-Kraft, a researcher at Glassnode, tweeted:
“There are now more than 3 million #Bitcoin addresses holding at least 0.1 $BTC (current value: $975 USD). That’s 14% more addresses than one year ago today.”
External factors like on-chain data and fundamentals show that there are not any major events that would have a big impact on BTC’s price within the short-term. That leaves the present price action of BTC along side macro trend projections because the two factors that are likely to sway BTC’s price within the coming weeks.
For bears or sellers, Bitcoin’s price dropping below $9,000 to avoid a golden cross at the mid-$9,000 region and an optimistic breakout on the weekly chart would indicate the resumption of a bearish trend.
For bulls or buyers, Bitcoin’s price remaining above the $9,500-to-$9,600 range would indicate that despite strong overhead resistance, there’s enough demand across spot, futures, options and institutional markets to sustain the uptrend of BTC.
