As a seasoned crypto investor with battle scars from the 2017 bull run and the infamous bear market of 2018, I’ve learned to read between the lines when it comes to market analysis. The recent surge in Bitcoin, breaking through its early August lows by nearly 30%, is a promising sign. However, as we stand at the precipice of $65,000, I can’t help but feel a familiar sense of deja vu.
Bitcoin has shown resilience, experiencing a rise of approximately 30% since dipping to as low as $49,000 in early August. As bullish sentiment grows and supportive fundamentals emerge for the most valuable digital currency, its price remains below $65,000. Examining the daily chart, this resistance level aligns with the previous highs reached in August.
Should buyers gain enough force to push beyond the current level, there’s a potential for the price to reach up to $70,000, a significant psychological threshold. If it manages to surpass $72,000 as well, this would be the first instance since June where the bulls have successfully overcome the resistance at their previous high point.
Bitcoin Rising As Selling Pressure Drops, Why Is $65,000 Hard To Break?
When on-chain data indicates that sellers are slowing down, it becomes challenging for buyers to push prices beyond $65,000. Following initial concerns in early September, traders have shifted their tactics, now favoring long positions over shorts and minimizing losses.
Based on insights from an analyst at X, looking at recent trading data, there’s been a significant decrease in the number of Bitcoin sales at a loss during the past trading week. The Bitcoin realized cap indicates that the amount of money lost by traders over the last week has dropped below $5 million to around $4.7 million.
Translation: In essence, many sellers are unwilling to sell their coins at a lower price now, reducing the number of sell orders. This decrease in supply could potentially boost buyers (bulls), creating a base for further increases in value.
Based on the pattern of candlesticks shown in the daily chart, the current significant resistance point stands at around $65,000. Yet, it’s worth noting that despite the strong conviction among buyers, they have thus far been unsuccessful in pushing prices beyond this potential sell-off level.
Bitcoin Sharpe Ratio At 11.8%, There Is More Room For Growth
When market demand weakens, an analyst observed that the Bitcoin Sharpe Ratio stands at approximately 11.8%. This ratio, utilized by on-chain analysts, helps assess the investment’s risk-adjusted performance in comparison to U.S. treasury returns.
At these stages, it signifies that Bitcoin (BTC) owners, during the past year, have been profiting significantly compared to bond investors.
As a crypto investor, I’ve noticed that when the Bitcoin Sharpe Ratio climbs up to approximately 20%, it often indicates a market peak. Given that the current ratio stands at 11.8%, this suggests there might be more potential for growth before reaching the speculative zenith.
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2024-09-24 22:11