The price of Bitcoin, the world’s largest cryptocurrency, has been in a bit of a downward spiral since the last time it rallied this vigorously. But Bitcoin enthusiasts have been quick to point out that a bit of a correction is just what it needs to shake off some of the damage inflicted by the previous price action.
This morning, Bitcoin rose above $58,000 and has been following a trend of lower highs and higher lows for the last 24 hours. This type of price action only happens when the Bitcoin price is at a new high, and it has happened in the past.
With Bitcoin’s price climbing to an all-time high this morning, the next question is: will it stay there? The answer is: it might not. Like other assets, a rising Bitcoin price is usually only a short-term thing. If you look at the historical charts of Bitcoin, you’ll see that over the years, this price movement is met with a very predictable pattern. The chart below shows how Bitcoin’s price responded to past price surges in the past.
Bitcoin has already closed seven straight green daily candles, putting it on pace to set a new record for the longest winning streak in 2021.
The previous time this occurred was on March 5, when the most popular cryptocurrency increased from $48,000 to $58,000 in less than a week.
Can we anticipate Bitcoin to reclaim $40,000 in the near future, since that the FUD seems to be over?
Bitcoin is aiming for a retest of the $40,000 level.
Bitcoin’s recent performance has seen it fall below $30,000, prompting some to predict more loss and confirmation of the bear market.
However, Bitcoin, as usual, performed the unexpected by recording a series of increases. BTC gained 34% over this time, closing at $39,500 yesterday. Today’s green candle would make it eight days in a row of gains.
The price did go over $40,000 late Monday evening before sellers grabbed gains and sent the price back down. Bulls, on the other hand, were able to purchase the sell-off, sustaining upward momentum and setting BTC for a retest of $40,000 today.
The present trend, according to Pankaj Balani, Chief Executive Officer of derivatives exchange Delta Exchange, is robust. He said that $45,000 is within reach, but $50,000 would be a struggle.
The $50,000 mark is a psychologically significant pricing threshold. Over the last five months, this zone has served as both support and opposition on many occasions. To make that happen, a large number of purchasers would have to turn up.
At the same time, Bitcoin seems to have reached a tipping point in terms of dealing with the FUD.
Elon Musk is rethinking Bitcoin as a means of payment for Tesla. Musk stated the network seems to have moved more towards renewable energy sources while speaking at The Word conference. However, he emphasized that he must do due research before making a decision.
In addition, the Bitcoin hash rate seems to have rebounded after hitting an all-time low of 85 million TH/s. Chinese miners who have been moved have begun to settle into their new homes, according to analysts. They predict that the hash rate will return to pre-FUD levels.
Fear & Greed Index turns from fear to neutral
Since the start of this week, the Fear & Greed Index has posted a remarkable upturn, with a reading of 50 today, putting sentiment in the neutral zone.
The reading was 32 yesterday, suggesting dread. Last week, the reading was as low as ten, indicating severe anxiety. During this time, Bitcoin had lost $30,000 in value.
Everything is in place for Bitcoin to make its move now that sentiment has returned to normal and the FUD has faded.
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