The longest weekly losing streak in Bitcoin history has finally been broken, but the mood among analysts is still not bullish.
Bitcoin (BTC) starts a new week with some hope for traders after stopping what has been the longest weekly downtrend in its history.
After struggling for support over the weekend, the BTC/USD pair finally found its footing to close the week at $29,900, up $450 from last Sunday.
The bullish momentum didn’t stop there: the pair rallied overnight through June 6 to hit multi-day highs.
The price action provides some long-awaited relief for bulls, but Bitcoin is far from out of the woods at the start of what promises to be an interesting trading week.
This article examines five factors to keep in mind when plotting BTC price action in the coming days.
A New Bullish Weekly Close for BTC
It took a long time, but the price of Bitcoin has finally closed a “green” week on the weekly chart.
The BTC/USD pair had spent a record nine weeks making progressively lower weekly closes, a trend that started in late March and ended up being the longest in its history.
On June 5, the pair reached $29,900 before the new week started, this being still about $450 higher than the previous week’s closing price.
While some celebrated Bitcoin’s newfound strength, others remained firmly cool on the prospects for a more substantial rally.
Michaël van de Poppe, a contributor to Cointelegraph, noted the gap in CME futures since the weekend, which is an incentive to return to $29,000.
For Il Capo of Crypto, a Twitter analytics account well known for its sobering views on BTC’s upcoming price action, there wasn’t much to be trusted either.
Consumer Price Index Data for May to be published June 10
The question for many is how much the CPI data can rise, as the aftermath of the Russia-Ukraine conflict and its impact on world trade and supply chains continue to unfold.
In the United States, interest rate hikes by the Federal Reserve are also under scrutiny as a result of rising prices.
The end of the “easy money” era is a tough one for stocks and correlated crypto assets in general, and that pain trend is not expected to end anytime soon, regardless of how inflation plays out.
Miner Capitulation “Very Close”
Despite weeks of lower prices jeopardizing their cost base, Bitcoin miners have so far refrained from significantly distributing their coins, but this could change soon.
In a June 6 tweet, Charles Edwards, founder of crypto asset manager Capriole, highlighted a classic bottoming signal in the Bitcoin hash tape metric.
Hash tapes measure the profitability of miners and have historically been accurate in their correlation to price phases. Currently, the March 2020-like “capitulation” phase is underway, he explained, but hodlers should do anything but sell as a result.
Fundamentals Echo Miner Calm
So far, the hash rate has remained stable above 200 exahashes per second (EH/s), according to estimates, indicating that miners are, for the most part, still active and have not slowed down for cost reasons.
In its next automated reset this week, the difficulty will drop by less than 1%, once again reflecting a relative lack of turmoil in the mining sphere.
Megawhales Show “Promising Sign”
In terms of aligning their words with their actions, the biggest Bitcoin investors could be leading this month.
As sentiment-monitoring firm Santiment noted, entities that control 1,000 BTC or more now hold more of the BTC supply than at any point in the past year.
“Bitcoin mega-whale addresses, partially made up of exchange addresses, hold their largest supply of BTC in a year,” Santiment summarized on June 6.
By Audy Castaneda
