Bitcoin price analysis: One BIG reason why BTC market may bounce back from $30,000 level soon
Bitcoin (BTC) price declined below $30,000 level amid the current crypto market crash. As of today, BTC price has moved above $30,000 level, priced $30,117 at the time of writing.
Bitcoin price decline is a part of the overall crypto market fall story in the last few days, specially due to Terra (UST and LUNA) debacle.
However, experts have pointed out one indicator according which BTC price may bounce back from the current level. They say that the number of persons holding at least one BTC has reached an all-time high, indicating BTC may bounce back from the current level even as the overall “extreme fear” sentiment in crypto markets persists.
“Bitcoin continued to consolidate around the $30K level. The market sentiment, however, has dropped to 8 on the Fear and Greed Index, falling to one of its lowest points. Meanwhile, the addresses holding 1 or more BTC has reached an all time high, an indication that the markets may bounce back from this level…,” WazirX Trade Desk said in a note today.
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“The weekly chart for BTC has broken below the long-formed ascending channel pattern. The next resistance for BTC is expected at $40,000 and an immediate support is expected at $24,000,” it added.
Darshan Bathija, co-founder and CEO at Vauld said, “There were a few signs of optimism in the BTC markets. According to data from IntoTheBlock’s In/Out of the Money Around Price (IOMAP) model, levels at $29,500 near were a strong support range as approximately 366.430 BTC were being held by roughly 481.910 addresses. Attempts to push the price below these levels could be met by buying from these investors who may want to increase their profits.”
“Additionally, on-chain data shows that the number of addresses holding between 1 to 10 BTC has increased from 689,000 to 694,000 since May 9, indicating confidence in the cryptocurrency’s recovery,” he added.
Investors may take some time to return after crash
Edul Patel, CEO and Co-founder, Mudrex feels it may take a little time for investors to return to the market after witnessing a massive crash last week.
“Even though Bitcoin stabilized a bit over the weekend, it again fell back to US$29,000 on Monday. The reversal of the downward trend could only be possible if BTC continues to trade above its support between US$27,000 and US$30,000 levels,” said Patel.
He further said that as BTC does not appear to be oversold, this can keep the short-term buyers active in the market.
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“Due to rising inflation levels and supply chain issues, cryptocurrencies and other equity markets have also been down on Monday. It seems like it may take a little time for investors to return to the market after witnessing a massive crash last week. The coming next two weeks will be critical for the entire crypto spectrum,” said Patel.
((Bitcoin and other virtual digital assets are unregulated in India. They are considered extremely risky for investment. Please consult your financial advisor before making any investment decision)