BTC Bulls are back in town, but will $60,000 fall?

Recently, Bitcoin has seen increased demand near a crucial support level, which led to a slight rally above the 200-day moving average at $59.2k.

This price action highlights the potential for a bullish reversal if the price stabilizes above the 200-day moving average.

Technical Analysis

By Shayan

The daily chart

A detailed analysis of Bitcoin’s daily chart reveals that after a prolonged downtrend, Bitcoin broke below the 200-day moving average at $59.2k, introducing significant fear and uncertainty into the market.

This MA is a vital support level for Bitcoin, and its breach usually indicates a potential downtrend. However, Bitcoin found strong demand in the substantial support region of the 0.5 Fibonacci level ($56,000), leading to a slight bullish rally. The price has once again risen above the 200-day MA, indicating a potential bear trap.

Additionally, a bullish divergence between the price and the RSI indicator further suggests the possibility of a near-term bullish reversal. If Bitcoin stabilizes above the 200-day MA, this could confirm a bullish resumption in the medium term, with the next target being the 100-day moving average at $64.6k.

Source: TradingView The 4-hour chart

On the 4-hour chart, Bitcoin faced rejection near the multi-month upper limit at $71,000, entering a sustained downtrend marked by lower lows and higher highs.

Upon reaching the decisive support region at $56,000, the bearish momentum faded, leading to a sideways consolidation. After this consolidation, an increase in buying activity led to a slight upswing.

Bitcoin is now in a crucial resistance region, including the important psychological resistance mark of $60,000 and the multi-week downtrend line, where selling pressure may increase.

If the cryptocurrency regains this resistance area, the uptrend could continue towards $65,000. Conversely, a rejection at this level would likely result in a continuation of the downtrend, targeting the critical support at $56,000.

Source: TradingView chain analysis

By Shayan

On-chain data highlighting miner profitability has proven to be a valuable tool for anticipating market bottoms during bear markets and the end of correction periods in bull markets. Analysis of this data can provide insight into potential market trends, particularly in relation to Bitcoin price movements.

Historically, significant drops in miner profitability during bull cycles have often been precursors to substantial increases in Bitcoin prices. Notable instances of this occurred in:

2016: During this bullish cycle, miners’ profitability dropped dramatically, as highlighted by the red circled area. After this decline, Bitcoin experienced a strong upward trend. 2020: A similar pattern was observed, where a rapid decline in miners’ profitability was followed by the start of a robust bull market for Bitcoin.

From 2024 onwards, a comparable pattern has been detected in the profitability of miners. The indicator has fallen significantly, mirroring the movements seen in the bull cycles of 2016 and 2020. This suggests that while the exact end of the current correction period is uncertain, the transition to a bull market may not be far away.

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