The price of Bitcoin has been consolidating for some time now and has failed to continue the significant upward momentum observed in recent months. However, things still look positive for BTC in the short term.
Technical analysis
By TradingRage
The daily chart
On the daily chart, the price has been aggressively attacking and breaking the resistance levels one after another. Nevertheless, the market is currently consolidating above the $40,000 level as the bullish momentum has faded. The decline in the relative strength index confirms this idea.
However, the RSI is still showing values above 50%, suggesting that the momentum has not yet shifted to the downside. Therefore, with strong support at $40,000, the price is still likely to reach the $48,000 resistance zone in the coming weeks before a major correction occurs.
Source: TradingView
The 4 hour chart
As the 4-hour timeframe shows, the recent consolidation has formed a classic price action pattern, the symmetrical triangle. The symmetrical triangle can be both a continuation and a reversal pattern depending on the direction of the possible breakout.
Therefore, investors can be optimistic that the price will eventually rise towards the $48,000 level in the event of a bullish breakout. On the other hand, a bearish breakout could lead to a deeper correction in the near term.
Source: TradingView
On-chain analysis
By Shayan
Miner-to-exchange flow (average)
The chart shows the 7-day exponential moving average applied to the Miner to Exchange Flow (mean) metric in correlation with the Bitcoin price. This unique metric shows the volume of coins transferred to exchanges by miners and provides insight into the potential selling pressure coming from miners.
In the past, large or minor drops in the Bitcoin price have always been accompanied by cases where miners initiated the transfer of their Bitcoin holdings to SPOT exchanges. However, a notable shift occurred recently as the metric saw a significant increase after Bitcoin price hit $45,000 and entered a consolidation phase.
This development suggests that miners are making profits and raises the possibility of a market reversal if the metric continues to rise and reach worrying levels. Monitoring this metric is crucial to anticipate potential changes in market dynamics and adjust strategies accordingly.
Source: CryptoQuant
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Cryptocurrency charts from TradingView.
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