An earlier rumor that Amazon would accept cryptocurrency payments spurred a wave of bullish enthusiasm in the crypto market, but this sentiment is now waning as Bitcoin ( BTC ) bulls face stiff resistance at $40,000
TradingView and Cointelegraph Markets Pro data show that bears have resisted multiple attempts to turn the $40,000 support level. The defense of this area continued on July 29, as Bitcoin’s price action remained stagnant, adding to fears that Bitcoin could drop back to the $35,000-$30,000 range.
Here are the views of investors and analysts on Bitcoin’s recent price movements.
The line between a bull market and a bear market is marked by the 21-week EMA
Bitcoin’s rapid rise from $31,000 to $40.925 raised the price to near its 21-week exponential moving mean, which is widely considered a bullish indicator according to Rekt Capital, a pseudonymous crypto Twitter analyst.
The 21-week EMA is largely regarded as a #BTC Bull Market indicator
When $BTC is above it – BTC is thought to be in a Bull Market
BTC is considered to be in a Bear Market when the price falls below its level
BTC is now fighting to breakout beyond the 21-week EMA (green)#Bitcoin #Crypto pic.twitter.com/rMqeWzJS4i
– Rekt Capital (@rektcapital)July 28, 2021
The tweet above shows that the 21-week EMA is at or near $40,000, effectively making it the ‘line between the sand’ which separates bears from bulls.
One of the replies to the tweet above warns against bullish traders who are too bullish because similar moves in past years were followed by lower lows, and an extension bear market conditions.
The chart shows that previous instances where the price broke above the 21-week EMA resulted in a reversal, which leads to a retest lower lows in subsequent weeks and months.
While others fearful, Bitcoin whales are still greedy
Bitcoin whales are a market participant who has shown little evidence that they are indecisive. They have adopted Warren Buffett’s advice to “be fearful when other are greedy and greedy when other are fearful,” by purchasing low-priced BTC when weaker hands tap out.
The #Bitcoin whales have been busy and addresses with 100 to 10,000 $BTC each just hit a #AllTimeHigh of 9.19m coins. They have added 170,000 $BTC to their total since May 22nd and an astonishing 130,000 $BTC in just the last 4 weeks. https://t.co/qv5IbYXgGQ pic.twitter.com/PwrmUyz9Of
– Santiment (@santimentfeed).July 29, 2021
Data from Santiment, an online behavioral analysis platform that tracks on-chain behavior, shows that whale wallets have accumulated 130,000 BTC over the past four weeks, as Bitcoin prices dropped below $35,000.
Analysts believe that whales might attempt to cause a price drop to continue their accumulation, with heavy accumulations in the $30,000-$35,000 range.
Long-term cycles can offer hope
Sometimes, it is best to step back and see the larger picture to understand the market’s future potential.
According to Inmortal ONLY, a pseudonymous Twitter account, Bitcoin’s current four-year cycle stands at 65% during its bull-market phase. The trader predicts a top of $150,000 which will be followed up by a correction to $32,000.
For holders and traders who prefer to work on a longer-term basis, there is still plenty to be hopeful about the future. Experienced market participants know that the price movements seen in the last few months are part of the normal progression of Bitcoin.
Ecoinometrics provided further evidence of this long-term view, comparing Bitcoin’s current price action after the halving to the performance in the two previous halvings.
#Bitcoin after the Halving
443 days after the 3rd halving#BTC at $39,973
It will take a lot of juice to catch up with the growth trajectory from the previous cycle.
We can only hope that this is the beginning of a new leg.
So far so good. pic.twitter.com/a12RYAhlsn
– ecoinometrics, (@ecoinometrics).July 29, 2021
The current price of Bitcoin is much lower than the average growth in previous cycles. This means that it has some work to do before it can achieve a similar trajectory, and rise above $100,000.
These views and opinions are the author’s and do not necessarily reflect those of Cointelegraph.com. You should do your research before making any investment or trading decision.