Will the Bitcoin bull market resume or is the push to $65,000 a trap? (BTC price analysis)

After a long period of sideways consolidation, Bitcoin entered a downtrend and broke below the key support zone at $59,000.

However, a notable bullish bounce around the 100-day moving average suggests that buying pressure could resume.

technical analysis

Written by Shayan

daily chart

A comprehensive review of the daily chart reveals that Bitcoin has experienced an extended phase of sideways consolidation within the key price range of $59,000 to $72,000.

Recent price action has seen a decline, breaking above the lower end of this range and the 100-day moving average. This bearish move led to the liquidation of many long positions and the beginning of a permanent market cooling period.

Nevertheless, Bitcoin finds significant support in a key zone, the Fibonacci retracement level of 0.618 ($59,395), coinciding with the key 100-day moving average of $59,000. The region has triggered a bullish reversal, raising hopes of a return to positive trends in the medium term.

However, a sudden break below the critical $59,000 level could trigger another notable down move towards the $56,000 threshold.

4 hour chart

Analysis of the 4-hour chart reveals that selling pressure has increased after Bitcoin failed to break above the $68,000 threshold. This created a significant downtrend, breaking below the wedge's lower trendline and hovering around $59,000.

Following this breach, numerous long positions were liquidated, resulting in a significant selloff and the $56,000 level was rapidly tested. However, the price quickly rebounded and rose above the lower bound of the wedge and the $59,000 support area.

Currently, BTC is on the brink of regaining its previous daily swing high of $65,000. If successful, the bullish trend towards $68,000 is likely to continue in the short term.

On-chain analysis

Written by Shayan

The attached chart shows the Bitcoin Short Term Holders (STH) Realized Price metric, which is a key indicator often used to identify areas of support and resistance on a chart.

This metric calculates the average short-term realized price, including trades that occur within a period of less than 155 days. It is derived by dividing the realized cap by the total supply of the coin, providing a weighted average price based on the amount paid for the coin by short-term holders.

This indicator has consistently acted as strong support for prices time and time again during bull markets. Following Bitcoin's recent decline, the price reached this pivotal level and found support, triggering a bullish rebound. However, it is essential to note that if the price falls below this important dynamic support, the market could potentially experience a significant decline.

Nevertheless, as long as prices remain above short-term participants' realized prices, the overall trend remains bullish. This indicator remains an important factor in assessing market dynamics and predicting potential price movements in the short term.