After a short-lived consolidation on Monday, bitcoin is back below the $50,000 psychological mark. The world’s most-followed cryptocurrency fell by nearly 2.4% to $49,197.15 in 24 hours after reaching its 3-month high. Where will it go now?
Bitcoin has finally resolved higher than the 200-day moving average and pushed past May’s $47,100 breakdown level. Analysts say that if bitcoin could move higher to $51,100, the next resistance could be the $58,000 to $60,000 zone.
Cointelegraph agrees that bullish BTC price actions do not fall short. Based on MACD, a reliable metric to track the general trajectory of an asset, a rare crossover appeared in August, which could lead to larger-than-expected gains for bitcoin. The same crossover happened in October 2020 when BTCUSD increased five times from $11,500 to $64,500 after 6 months. They projected a $220,000 BTC price should history repeat itself.
Meanwhile, bitcoin’s largest corporate investor, MicroStrategy, stays bullish and bought $177 million more in bitcoin from July until August 23. This purchase boosted the firm’s bitcoin investment to a massive $5.4 billion in total.
While bitcoin surged above $50,000 for the first time since May, blockchain analytics firm Glassnode emphasized that BTC transactions are low in volume. On-chain activities remained at historically low levels at 175,000-200,000 transactions daily. However, low-level transaction volume was also observed during the 2016–2017 bitcoin bullish market. Glassnode noted that the climbing prices coupled with low on-chain activity lead to an “extraordinarily macro bullish outlook.”
Nevertheless, some indicators are showing a possible slow down in price climbs. Glassnode data indicated that crypto exchanges received 16,606 BTC on Monday. That was the highest inflow per day in over a month. Moreover, investors moved about 29,000 BTC to exchanges in the past week. Generally, moving crypto to exchanges suggests a plan to sell. Bitcoin whales holding 1,000–10,000 BTC also declined over the past 3 weeks.
According to QCP Capital, the buy side of bitcoin weakened when BTCUSD failed to close the day above $50,000. On Monday, BTCUSD peaked at $50,402.71 on SimpleFX and closed at $49,398.72. The digital economy trading firm also stressed that they don’t see an “exponential upside breakouts” like those by the end of last year. Not to mention, implied volatility continues to be calm and investors, in general, expect some price turbulence to happen.
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