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Bitcoin reversed direction and made a strong U-turn, with $2W1 providing significant support

Bitcoin recently started to rebound, rising 1.7% to above $23,300, snapping a five-day losing streak.

The largest cryptocurrency by market capitalization has surpassed its 50-period index moving average (EMA) of $23,214.50 and is within its 10-period moving average as it has also surpassed its 50-period moving average.

Prices above moving averages and moving average crossings are seen as bullish signals.

Despite some turmoil in the industry, BTC prices are holding up because of a multimillion-dollar hack of the Solana (SOL) wallet. It appears that the negative impact surrounding the bug has been contained to SOL as the price of the token fell 3% on Wednesday.

In traditional markets, the S&P 500 rose 1.6%, while the Dow Jones Industrial Average and the tech-heavy Nasdaq Composite gained 1.4% and 2.6%, respectively. The services purchasing managers' index also unexpectedly rose in July.

8209cd573b35bebddac0abdc6bd567ccBitcoin prices rose despite lower than average trading volume. Volume last traded above its 20-period moving average on July 29. The importance of volume has to do with assessing the "forces" or beliefs or both behind price movements. Higher turnover usually indicates greater confidence in the direction of asset prices.

BTC appears to have entered an uptrend after hitting a low on July 13. The extension of the trendline implies an increase to $25,000, but this should not be interpreted in isolation as a price target. As noted above, BTC prices have moved above their 10-period and 50-period moving averages, which themselves appear poised to "cross over".

BTC's relative strength index (RSI), often used as a proxy for price momentum, edged higher to 59. There has also been a clear upward trend in the RSI since bottoming out in June.

The on-chain data indicates that the call option ratio on BTC has fallen below zero. The put ratio shows the number of puts in the last 24 hours divided by the number of puts traded in the options contract.

Since a put represents an option to sell bitcoin and a BTC call represents a call to buy, anything below zero means more calls have been bought than puts. Buying more calls is seen as a bullish signal.

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