The king of cryptos continues its recovery, but it is unknown how long this will last.
Many cryptocurrency investors are currently rejoicing in the technical rebound of Bitcoin (BTC), despite bad macroeconomic news such as the US GDP contracting for the second consecutive quarter, and the core PCE (statistic much watched by the FED to measure inflation) which remains at high levels.
However, major risks largely priced recently help to explain the resilience of all risky asset classes. So much so that the theory of market efficiency is not making much sense. It is uncertain if it was not yet another trick to trap the last latecomers who were full sellers.
After dismissing the threat below the $20,000 support, the king of cryptos seems to have decided to test its next levels of resistance. The latest technical analyzes bear witness to this short-term momentum. With the prospect that Bitcoin will conquer one of the key thresholds of its last bull run.
Following is a summarized Bitcoin price analysis, based on Le Trading du Coin and its algorithmic trading solution, accessible to individuals.
BTC in Monthly Units: Positive July after Multiple Hesitations around the $20,000 Support
Barring an incredible situation and after the spring rout, Bitcoin seems set to end on a positive note in July. Not without difficulty in the sense that it took a while to rebound from the $20,000 support. Whether there will be any certainty in the short term remains to be seen.
Cryptocurrency investors are looking to cling to the idea that BTC prices are above the Kumo (Ichimoku cloud) in monthly units, and similarly for the Chikou Span. In contrast, the evolutions of the Tenkan and the Kijun would mean investors should be cautious. Their rapprochement, which is the result of the last bearish wave, would potentially constitute an additional source of tension in its bear run.
BTC: Soon in Contact with Tenkan?
Projecting onto the weekly chart, Bitcoin’s bear run since its last ATH in 2021 temporarily calms down. Meanwhile, prices fail to erase the losses of the weekly candle of June 13th. In order for this not to be an obstacle for the technical rebound to continue, it would be necessary to overcome two resistances that are close to each other: that of $26,000 and that of Tenkan.
If so, BTC prices would be facing a major issue, the resistance at $30,000. Beyond its major role in the latest Bull Run, it could end up near the falling line in favor of bullish velocity before mid-August. Even so, prices and the Chikou Span would still remain below the Kumo.
This could be frustrating for cryptocurrency investors not to see the end of the tunnel. But patience is required until prices for the king of cryptos recover to the head-to-shoulder neckline around $41,000. Just to consider a definitive neutralization of the bear run (not to be confused with a real trend reversal).
Thus, the possibility of a Tenkan – Kijun crossover in monthly units would hardly be reassuring from a medium-long term perspective, even if it would not represent a reliable technical signal given its latency.
It is worth considering, in summary, that crossing the descending line would not be enough to conclude a favorable trend reversal. Especially since there would be a lot of work to tame future Kumo into weekly units. A passage beyond the large resistance zone of $41,000-46,000 would ultimately be the necessary condition to initially balancing the balance of power between buyers and sellers.
By Audy Castaneda
