Last week, the price of Bitcoin experienced significant volatility, and unfortunately, it was not bullish. Even if the price has once again lost $120,000, entities that have more than 100 BTC are not discouraged, on the contrary. Despite this significant buying pressure, we can legitimately wonder whether the current cycle is coming to an end. In The Market Check, we look at on-chain and technical data to see if BTC is still theoretically in a bull market. Is BTC sending negative signals showing that sellers are regaining control? Here we go!
Bitcoin once again back on an important on-chain level!
The violent fall of Bitcoin brought the price back to the level of realized price of short-term holders (orange curve). Since September, the course has already bounced twice on this on-chain level. Moreover, the last time, the price then marked a new ATH at over $126,000 :
Graph representing the realized price of short-term holders of Bitcoin. Source: Bitcoin Magazine Pro If the average purchase price of short-term holders located approximately 114 000 $ allows a new buying reaction, the price of Bitcoin could still mark a ATH. However, if the course drop below $110,000of the bearish volatility is possible. This is in fact often what happens when the price slips below the orange curve.
The king of cryptocurrencies finds the 128-day moving average
On a technical level, the price of Bitcoin returns to the level of 128-day moving average (blue) which is located around the 113 500 $. Here again, this is a level which has several times allowed rebounds in recent weeks:
Different moving averages applied to Bitcoin. Source: Checkonchain As BTC is at an important technical level, a end of correction is possible. If the fall continues, the price could head towards the 365-day moving average (orange) located at $100,000. For the moment, the moving averages are bullishso these indicators allow us to still have hope.
The Crypto Fear and Greed Index returned to extreme fear zone during the crash
At the end of last week, the fall of Bitcoin caused a extreme fear in the cryptocurrency market. The Crypto Fear and Greed Index (CFGI), an indicator of market sentiment very well known, returned to 24 (extreme fear). A market feeling as feverish as in April :
Crypto Fear and Greed indicator chart. Source: Glassnode It must be said that Trump has revived bad memories to investors by threatening China with significant new customs duties. The last time Trump raised this subject, the price of Bitcoin had fell by more than 30%. We often hear that periods of fear in financial markets are good times to go on sale. But be careful, as John Maynard Keynes said: “the market can stay irrational longer than you can stay solvent.”
Risk of fall towards $100,000 for Bitcoin?
Since the beginning of bullish cyclethe price of BTC evolves above the 350-day moving average (orange). This situation indicates that buyers have the advantage over Bitcoin. Because during the bear market from 2022, the price was moving under the orange curve:
Golden Ratio Multiplier indicator. Source: Bitcoin Magazine Pro For several months, BTC has been growing between the orange curve and the green curve (multiple 1.6 of the 350-day moving average). If the course continues ATH for several months, he has difficult to accelerate strongly like at the end of 2024 for example. In the event that BTC continues to block against $120,000he could find the 350-day moving average. It is located around the 100 000 $. And bullish scenario is also possible on the price of Bitcoin. If BTC recovers here, a acceleration towards the green curve at $160,000 is possible. It is around this level and against the multiple 2 of the 350-day moving average (red) that BTC tends to finish its rise.
Key points to remember
Last week's violent movement does not appear to have changed Bitcoin's dynamics. Technical and on-chain analysis suggest that a further rise in BTC is possible. The king of cryptocurrencies has the opportunity to bounce off the average purchase price of short-term holders as well as the 128-day moving average. However, if BTC remains fragile, a return to $100,000 cannot be ruled out. If Bitcoin continues to follow gold, new all-time highs are still possible.