Despite being rejected by Bitcoin in recent weeks, Bitcoin continues to struggle to break the $24,000 resistance. Will the bulls eventually manage to break it, or will the bears prevail?
Technical Analysis
Author: Edris
Daily Chart
The price is technically in an uptrend as it has been forming higher highs and lows, but the $24,000 level has proven to be a very strong barrier. The 100-day moving average also reached the same area. It has been providing additional resistance so the price has yet to close above it.
A break above the $24,000 level could lead to a massive rally towards the $30,000 supply zone. This will be the next major resistance. On the other hand, in the event of a bearish pullback, the 50-day moving average (currently at the $22,000 level) could support prices.
4-hour chart
On the 4 hour time frame, everything remains the same as last week. The price has yet to break out of the big bearish flag and was rejected again after touching the higher border of the pattern for the fourth time. Currently, the cryptocurrency appears to be targeting the bullish trend line shown on the chart.
The RSI indicator has been hinting at a huge bearish divergence between the last 4 hour highs. A bearish breakout below the aforementioned trendline would be the most anticipated scenario. In this case, the lower border of the flag and the $20,000 support area will be retested.
A bearish continuation would be expected if the price eventually breaks below the flag. Therefore, BTC could break below the recent lows of $18,000 and continue towards the $15,000 level.
On-chain analysis
Author: Edris
Bitcoin long-term holder SOPR
Bitcoin’s bear market in previous months resulted in huge realized losses for all participants. Even long-term holders, who usually use the coin for profit, are currently suffering losses. This behavior typically occurs in the final stages of a bear market, when long-term holders start panic selling. This is called “surrendering”.
These holders usually own large amounts of Bitcoin as they accumulate their coins at cheaper prices and hold them for the long term. They will inject a lot of supply into the market, which usually triggers the last crash of a bear market cycle. Eventually, a bottom starts to form when smart money decides to accumulate these cheap tokens.
The SOPR indicator for long-term holders shows the number of gains and losses realized by this particular group. The indicator has been below 1 since late May 2022, indicating that long-term holders are continuing to realize loss. However, it seems to be recovering and starting an uptrend recently.
Historically, this indicator exceeds 1 to mark the start of a new bull market. Still, it’s too early to declare the bear market over — the recent rally may just be another bull trap in a downtrend — as seen in previous bear markets. Long-term holders’ SOPR indicators should be closely monitored in the short term to determine which scenarios are more likely to occur.
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Cryptocurrency charts by TradingView.
