Market Status: Bitcoin is on the verge of registering its fourth bullish candle in the last 6 weeks
The weekly Bitcoin price candle closes in less than 48 hours, and if nothing special happens, this digital currency can experience its fourth upward week in the last 6 weeks. At the same time, some technical indicators show the chance of Bitcoin to continue this upward trend in the long term.
To Report CoinDesk, Bitcoin, which once again bounced back above the $24,000 level yesterday, is currently trading above $24,600. The price has grown by 6.65% in the last seven days and by more than 3% in the last night.
Ethereum, which has passed the $1,900 resistance twice this week, has fared better than Bitcoin and has grown by 15.56% over the previous week. These days, Ethereum investors are impatiently waiting for the update of this network or the Merge event, which is supposed to transfer the mechanism of this blockchain from the old proof-of-work model to the less expensive proof-of-stake model.
Bitcoin and Ethereum have lost 50% and 48% of their value, respectively, since the beginning of this year and have had a very high price correlation with each other. It should be noted that the correlation between the price of Bitcoin and Ethereum was 92% in the last 30 days and 87% in the last 90 days.
Traditional financial markets also ended the week with gains, with the Dow Jones Industrial Average, S&P 500 and Nasdaq rising 0.61%, 1.12% and 0.85%, respectively. . It should be noted that this growth in stock prices was a common movement and 70% of the shares in the New York Stock Exchange and Nasdaq faced an increase in price the previous day.
On the other hand, the price of crude oil and natural gas has decreased by 2.6% and 1.17% respectively in the past 24 hours. Gold has also increased in price by 0.53% during this period.
A look at the technical status of Bitcoin
Bitcoin’s recent uptrend can be clearly seen on the weekly chart. After falling 42% between March 28 and June 27 (April 8 to July 6), the price returned with a 25% jump to above $24,000; Of course, with a little negative swing along the way.
The increase in the volume of Bitcoin transactions started on June 13 (June 23) and simultaneously with the exit of sellers from the market. The question that has arisen for investors is whether this selling pressure was based on the perceived value of Bitcoin or whether it was formed under the influence of the collapse of other financial markets.
The crash that happened around June 13 coincided with the withdrawal of users from the Celsius lending platform and the news of the $400 million liquidation of Three Arrows Capital.
From a technical point of view, the reduction of the price fluctuation range in the weekly market view and the drop in the average true range (ATR) index of Bitcoin after June 13 show the subsidence of fluctuations and the desire to sell among investors. The relative strength index (RSI) on this date showed oversold and the exit of investors from the digital currency market; But it also gave an opportunity to investors who were willing to accept the risk of entering the market at that time.
In this technical index, level 70 indicates oversaturation and currently the weekly RSI of Bitcoin is at level 30; So it can be said that Bitcoin is now probably trading at a relatively low price. It should be noted that Bitcoin RSI reached its lowest level since 2015 at 25.72 in the week that began on June 27 (July 6).
This means that oversold in the Bitcoin market that week reached its peak in the last 7 years. Traders, who use RSI to determine their entry and exit points from the market, considered this historical low as an opportunity to enter the market and buy more bitcoins, and ultimately caused the price of this digital currency to increase at the beginning of the summer.