Bitcoin really hasn’t done well in the past few quarters, with the price of the leading cryptocurrency tanking from $14,000 to as low as $6,400 in mere months. While this price action has been decisively bearish, the decline in Bitcoin’s price has created a bullish signal on a key indicator, suggesting that in the near future, BTC will once again return to a bullish state.
Bitcoin Poised to Burst Higher
Cryptocurrency trader CryptoHamster recently noted that Bitcoin’s on-balance volume reading — an indicator which “uses volume flow to predict changes in stock price” — is printing a clear falling wedge pattern, a chart pattern marked by falling prices (or in this case, a reading) and a tightening range.
In this case, the falling wedge seems bullish, with the Bitcoin-related on-balance volume reading rallying, implying imminent continuation to the upside.
Yes, the price of the asset doesn’t always follow its on-balance volume (or vice-versa), though as seen in the chart above, there was a massive surge in the indicator during the Bitcoin price run-up from March to June/July seen in 2019.
This means that the price of BTC may be on the verge of erupting higher in the coming weeks.
Not Only Bullish Indicator
If you don’t give much credence to the falling wedge seen in the on-balance volume for Bitcoin, there is a confluence of other indicators suggesting BTC’s return to a bull phase is imminent.
According to Willy Woo, partner at cryptocurrency fund Adaptive Capital and a noted on-chain analyst, his indicators which track investor activity — correlated closely with market cycles — are showing clear signs that Bitcoin is decisively not in a bear market.
Rather, as Woo continued in the tweet, the indicators suggest that BTC is in the midst of a “re-accumulation” phase of bull markets that always proceeds the blow-off top rally, one that brings Bitcoin an order of magnitude or two higher than where it started.
History repeating per Woo’s analysis means that Bitcoin will burst higher by the second half of 2020, meaning BTC is likely to set new all-time highs a few months or a year after that.
Not to mention, an analyst which called the decline to the $6,000s weeks ago is suggesting that Bitcoin will soon surge 40% to pass $10,000, citing their idea that BTC will form an Adam and Eve bottom in the current range prior to rocketing higher to precede May’s block reward reduction.
Source: Read Full Article