Bitcoin (BTC) is still below a key moving average and that is “not a bullish sign,” says a new report, but signs of a rebound have finally arrived.
In its latest market update Released on June 11, the Decentrader trading suite highlighted three on-chain indicators calling for an imminent bullish continuation for BTC / USD.
The indicators echo the aftermath of March 2020
Bitcoin is now almost a month below its 200-day moving average (DMA). This is worrying, Decentrader warns, and external factors such as geopolitical sentiment continue to weigh on sentiment.
“Bitcoin has kept the market on its toes as it continues to oscillate between the weekly support at $ 32,000 and the short-term resistance of the 200DMA currently at $ 42,000,” the update summarized.
“Uncertainty after the recent collapse, and fears surrounding President Biden’s announcement at the G7 Summit next weekend on how the United States will approach cryptocurrencies in relation to recent ransomware attacks, are keeping the price low for now. “.
Bitcoin continued to oscillate over the weekend, at the time of writing trading close to $ 36,000 amid some signs of reversal of the resistance closer to $ 40,000.
Fortunately, however, various measures of strength in the chain now suggest that the rebound from a bearish phase within a general bull market is already underway.
These are well known: active directions sentiment, Spent Production Profit Index (SOPR), and stock-to-flow deviation. The latter two have been extensively covered by Cointelegraph.
Meanwhile, active addresses measure whether Bitcoin is overbought or oversold at a certain price relative to the number of active addresses on the blockchain.
Like SOPR, the indicator is currently in the same position as just after the bear market floor in December 2018 and the crash in March 2020.
As such, if history repeats itself, the only way is up.
“We received the same signal yesterday, suggesting that the $ BTC price was oversold relative to active addresses on the chain and could now be ready to rally in the coming weeks,” the update explained.
$ 85,000 in months?
Also at stake is a rally toward the stock-to-flow trajectory line, something its creator, PlanB, says would be a “surprise” if it didn’t happen.
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Amid hopes that BTC / USD still hits $ 100,000 this year, Decentrader predicted that it will only be a matter of months before Bitcoin returns to normal.
“While we may not be rebounding as strong and fast this time, fundamentally nothing has changed with Bitcoin running, nothing is broken, we are just experiencing a lot of bad media coverage after a strong rally earlier in the year,” the company said. completed.
“Therefore, we may see the price return to the stock-to-flow line in the coming months. This would mean new all-time highs for $ BTC before the end of this year, as the stock-to-flow line lies currently at $ 85,000. “