Bitcoin (BTC) price analysis: Are you ready for this rally?

Bitcoin may extend its recovery in the next few days

Bitcoin (BTC) price analysis                                 
The bulls are attempting to build upon Bitcoin’s recovery – Photo: Shutterstock
                                

Contents

Sentiment in the crypto markets improved after equities markets in the United States made a strong comeback last week. That started a relief rally in BTC and pushed the price above $21,000. The bulls are attempting to build upon the recovery in the week beginning 27 June 2022. 

Julio Moreno, senior analyst at the on-chain data firm CryptoQuant, said in a blog post on 24 June that miner capitulation, which preceded Bitcoin bottoms during previous cycles, may have already happened or could have started. 

Another analyst suggesting that Bitcoin looks interesting is David Puell, the creator of MVRV and Puell Multiple. He said that the realised price of long-term Bitcoin holders was $22,200 and that of short-term Bitcoin holders was $31,700. In reply to this observation, the Bitcoin on-chain and cycle analyst who goes by the name of Root said that Bitcoin had either bottomed out or was close to a bottom.

The analytics resource Game of Trades pointed to “unusual whale activity” in Bitcoin. It said that there was an increase in demand for Bitcoin from whales holding between 1,000 and 10,000 Bitcoin

However, Bitcoin investors may have to be patient as the recovery could be slow. Changpeng Zhao, founder and chief executive of Binance, told the Guardian: “I think given this price drop, from the all-time high of 68k to 20k now, it will probably take a while to get back. It probably will take a few months or a couple of years” 

Could buyers sustain the momentum? Will Bitcoin go up? Read our BTC price analysis to find out.

Bitcoin price technical analysis: Weekly chart

Bitcoin weekly price analysis chart for 27 June 2022
Bitcoin weekly price analysis chart 27 June 2022 – Credit: Currency.com

BTC’s price formed an inside-day candlestick pattern last week, suggesting that the selling pressure could be reducing. The BTC/USD pair rose 2.33% last week to finish at $21,024.

The relative strength index (RSI) is still below the 30 level, indicating that the selling may have been overdone in the near term and a relief rally is possible. The buyers will attempt to push the price toward the breakdown level of $28,639.

This is an important level to keep an eye on because the bears will try to defend it aggressively. If the price turns down from this level but does not break below $20,000, it will suggest that the bears may be losing their grip. 

The buyers will then make another attempt to push the price above the overhead resistance. If they succeed, it will suggest a potential trend change.

This positive view could invalidate if the price turns down and plummets below the crucial support of $17,574.60. If that happens, the decline could extend to $13,839. The Bitcoin price analysis suggests that the bulls are trying to start a recovery.

Bitcoin price technical analysis: Daily chart

Bitcoin daily price analysis chart for 20 June 2022
Bitcoin daily price analysis chart for 20 June 2022 – Credit: Currency.com

The buyers are attempting a recovery but the bears continue to sell on rallies. BTC’s price is struggling to rise above the overhead resistance zone between $22,000 and the 20-day exponential moving average (EMA).

If the price turns down from the current level, the bears will attempt to pull the pair to $19,500. This is an important level to keep an eye on because if the support breaks down, the pair could retest $17,574.60. 

Contrary to this assumption, if bulls thrust the price above the 20-day EMA, the bullish momentum could pick up and the pair could rally to the 50-day simple moving average (SMA).

Bitcoin: Buy or sell at current levels?

The bulls are attempting to push the price above the 20-day EMA. If they manage to do that, it will suggest the start of a sustained relief rally. The pair could then rally to the 50-day SMA. Bitcoin price analysis suggests that a break below $19,500 could invalidate the bullish view in the near term.

The views and opinions expressed in the article are those of the author and do not constitute trading advice. Trading and investing involve substantial risks and you should do your own research or contact your financial adviser before arriving at a decision.

Further reading

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