The world’s largest cryptocurrency Bitcoin (BTC) continues showing strength and has given a move above the $22,200 level gaining 3% in the last 24 hours. As per the technical charts, BTC is trading at a crucial junction of its 200-day moving average (MA).
The last time, BTC had faced a strong rejection at these levels followed by a major correction. As popular crypto analyst Ali Martinez explains:
The last time #Bitcoin reached the 200MA on the 12hr chart, it resulted in a steep correction. The TD Sequential now presents a sell signal at the same level, anticipating a retracement. $BTC must print a 12hr candlestick close above $22,950 to invalidate the bearish outlook.
Also, on-chain data for Bitcoin realized profit/loss shows that there’s profit taking at every price rise for Bitcoin. The Realized profit/loss ratio for Bitcoin is currently under 1.0 which highlights a strong bear cycle. As Glassnode explains:
An interesting observation is the upward trend which initiated in early June, and peaked in mid-August, having since descended to 0.58. This pattern reconfirms that an uptick in profit taking took place by investors during that relief rally.
Some Positive Developments for Bitcoin
After attempting for dips under $20,000 last week, the BTC price was quick enough to bounce back and is holding $20K as a strong support level. Citing the number of active addresses. analyst Ali Martinez also believes that the Bitcoin bottom could be in. In one of his recent tweets, the crypto analyst wrote:
The number of new daily $BTC addresses on the network appears to be increasing rapidly, with the weekly average hovering around 410,000 addresses. A sustained move above 415,000 #BTC addresses could confirm the optimistic outlook.
Also, the total number of BTC addresses with at-least one or more Bitcoins has reached closer to 100,000. This shows that retail players continue to accumulate.