Bitcoin: Is this the bullish rally BTC holders have been waiting for?
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- BTC broke out of its price range with a strong push above the $29k level.
- Supply on exchanges declined to encourage buyers in the short term.
Bitcoin [BTC] broke out of a week-long price stagnation with a significant push above the $29.4k resistance level. Previously, BTC has traded between $28.9k to $29.3k with a dip in demand between 5 August to 7 August.
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This 3.6% rally over the past day saw Bitcoin’s market dominance rise to 48.94%. As of press time, the king coin was trading at $29.8k with bulls actively looking to reclaim the $30k price level.
Bulls strengthened by infusion of capital inflows
The Chaikin Money Flow (CMF) highlighted the notable inflow of capital into Bitcoin over the past 48 hours. The indicator rose sharply from negative to positive with a reading of +0.07, as of the time of writing. This translated into a significant rally by buyers to break out of the price range.
The Relative Strength Index (RSI) echoed the new buying pressure, as it climbed above neutral 50 and stood at 62. These were pointers that Bitcoin was experiencing a new wave of demand after last week’s lackluster price action.
A major hurdle in the form of a bearish order block (OB) at the $30k price zone lies in the way of bulls achieving more gains. A look at the 12-hour timeframe showed that price has retraced twice at this bearish OB.
With BTC maintaining a bearish outlook on the daily timeframe, crossing the $30k hurdle will be key for bulls to maintain the bullish rally and push on for more gains.
Read Bitcoin’s [BTC] Price Prediction 2023-24
Mean coin age rose as supply on exchanges declined
Data from Santiment showed that the 90d mean coin age rose sharply on 4 August after a previous decline. This hinted at an accumulation of Bitcoin which translated into its recent price rally. As of press time, the mean coin age continued to rise indicating that more buyers were bidding for BTC.
At the same time, the supply on exchanges declined, which showed an easing of the sell pressure. The evidence pointed to more gains for BTC in the short term, if bulls can overcome the bearish OB.