Decipher why bitcoin[ BTC] is back below the $30,000 mark

The bitcoin [BTC] The saga seems to be endless as the flagship cryptocurrency plunged below $30,000 again. The king coin showed signs of recovery after the collapse of Terra, but it looks like the crypto gods are not that happy with the coin. Now the question is: Why has BTC fallen again and is a near-term recovery on the horizon for investors?

let’s find out

The turning on and off of the king coin

Bitcoin prices are back below $29,000 after the Terra crash. There are suggestions pointing to macro headwinds responsible for pushing BTC prices to support levels.

Remarkably, the S&P 500 and NASDAQ ended their seventh straight week of losses. This is the longest losing streak since the end of the dot-com bubble in 2001. In addition, the Dow is also on its eighth straight weekly loss, the longest losing streak since the Great Depression of 1932.

A Santiment tweet also pointed to a correlation between BTC and the S&P 500 Index and how BTC’s bullish move has been “stopped” by “stocks.” Major indices went into free fall with warning signs of recession and looming inflation in general.

Despite this, the king coin saw bulls enter at the $30,000 level only to lose the battle against the bears. At press time, the Fear and Greed Index was 13, meaning “extreme fear.”

What do the charts say?

The metrics also agree with the information above and are sending out worrying signals about the Bitcoin network. Investors’ fears can also be felt in the low transaction volumes.

Transaction volume fell to a four-month low on May 21, according to Glassnode reports. This extreme low was also observed back in March 2022 when the transaction volume was 145,015.1 BTC.

Source: Glassnode

Another metric underscoring a bearish stance on bitcoin’s bitter state is the NVT signal. The May 21 NVT signal for Bitcoin was at a stunning four-year low of 235.2, according to Glassnode.

This indicated that Bitcoin was nearing a local market bottom, which historically represents a period of accumulation. However, currently there is underlying FUD sentiment in the market due to reduced asset prices.

Source: Glassnode

Wait a minute… There’s more

Interestingly, renowned crypto analyst Plan B recently tweeted suggesting a trend reversal in BTC prices. Plan B’s price predictions are widely used for analysis in the crypto community given its 1.8 million Twitter followers.

Realized price / moving average (RPMA, purple) best shows the #bitcoin cycle. The Relative Strength Index (RSI, yellow) is similar but can be misleading during critical times (e.g. H2 2021). The good news: the bear market is almost over. Wait for RPMA and RSI to start rising again. pic.twitter.com/Naz2zPV071

— PlanB (@$100 trillion) May 20, 2022

Plan B used the Realized Price/Moving Average (RPMA) and RSI metrics to infer that the bear market is nearing an end. Confidence in the BTC rally is growing, with Plan B suggesting RPMA is the “best” indicator for Bitcoin. Despite all the bearish signals, Plan B looked hopeful for a quick rebound.

Well, no matter what the indicators or analysts say, only time can tell Bitcoin’s future price action.

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