Is this the moment Bitcoin bulls have been waiting for?
At the time of writing, the world’s largest cryptocurrency is trading just below the $22,000 mark, having earlier edged higher towards its 50-day simple moving average (SMA) that currently resides around $23,050. The 50-day MA is a widely-used technical indicator that can denote a key level of support or resistance.
If prices of the world’s largest cryptocurrency can break above its 50-day SMA, that could be interpreted as a bullish signal, with more price gains potentially ahead.
If so, then the next level of resistance may then arrive at the mid-May dip around $25,424.51.
Tuesday’s gains for Bitcoin have been fuelled by the risk-on sentiment across markets, evident by rising US equity futures at the time of writing.
Even alt-coins are being swept up, along with shares of Bitcoin miners such as Marathon Digital Holdings, Riot Blockchain, and Core Scientific Inc. which posted stunning double-digit gains respectively on Monday.
Still a long way from the top
However, for broader context, since diving to the depths of $17,600 a month ago, Bitcoin has only so far managed to carve out the slightest of uptrends. Despite posting a series of higher-highs and higher-lows, such cycles have been largely confined to the $19,000-$22,000 range.
And to be sure, Bitcoin remains about 53% lower so far this year, while still some 68% down from its ATH (all-time high) set back in November.
That means it still has a lot of ground to cover to make up for its stunning losses sustained since.
Such meandering price action suggested that Bitcoin, and by extension the broader crypto world, was looking for a fresh spark to embark on a noticeable move either direction.
Can Bitcoin punch past the macro woes?
Overall, the fundamental picture looks bleak, as the Fed proceeds with its rate-hike plans with ambitions of cooling down runaway consumer prices, with such efforts feared to ultimately trigger a recession.
Such an outlook is dampening appetite for risk-taking activities across markets.
In short, Bitcoin bulls still have all to do.
Prices must continue holding the line around these $20k levels, and push prices noticeably above the 50-day SMA. This combo of events may perhaps finally allow Bitcoin to start staking its claim as a purported safe haven asset that it has long aspired to be.
Otherwise, the “rising wedges” pattern from last week’s report still holds, which could yet herald a swift decline down to US$10k.