Parabolic Rally In The Making? Bitcoin Regains $70,000 As Traders’ Paper Profits Collapse To 3%
May 28 2024 - 12:00AM
NEWSBTC
The world’s largest cryptocurrency, Bitcoin (BTC), has been
consolidating over the past week, trading between $67,000 and
$70,000 after experiencing a brief 20% price correction that sent
it as low as $56,400 in early May. This consolidation period
comes as inflows into the US spot Bitcoin ETF market have
reignited, and selling pressure appears to have cooled off, both in
the ETF market and among Bitcoin investors more broadly. Bitcoin
Selling Pressure Fades According to Julio Moreno, head of research
at on-chain market analytics firm CryptoQuant, the current Bitcoin
price level of $70,000 differs from when it last reached that mark
in March. Moreno notes that traders are now exerting much
lower selling pressure, as unrealized profits are only around 3%,
compared to 69% in early March. This suggests that much of the
“heavy selling” has been exhausted, as seen in the chart below.
Related Reading: DeFiance Capital Foresees ETH Soaring To $4,500
Pre-Ethereum ETF Trading Santiment data also shows that Bitcoin has
once again eclipsed a $70,000 market capitalization, even as the US
stock market took a hiatus for the Memorial Day holiday.
Market intelligence platform Santiment sees this as an encouraging
sign, as it demonstrates BTC’s ability to perform positively on
days when it is not closely correlated with the primary stock
market, which has been the case for much of 2022. Final
Pre-Breakout Consolidation Phase Despite this positive momentum,
crypto analyst Rekt Capital has noted that Bitcoin’s latest weekly
candle closed below the range high resistance of its ongoing
“re-accumulation” phase, which spans roughly $60,000 to $70,000.
This likely sentences the leading cryptocurrency to further
consolidation within this range, aligned with Rekt Capital’s thesis
that two phases remain in the current bull cycle: the post-halving
re-accumulation phase and the “parabolic rally phase.”
Historically, Bitcoin has tended to consolidate around all-time
highs before embarking on the most illustrative stretch of its bull
cycles. According to the analyst, Bitcoin has indeed been
consolidating at these highs for quite some time now, especially by
the standards of previous cycles. While there is still room
for further sideways trading at these elevated price levels, the
time remaining in this phase is slowly running out. This leads to
the belief that the long-awaited post-Halving rally, coupled with
renewed investor sentiment, is poised to take the largest
cryptocurrency on the market to even higher levels than the current
$73,700 reached in mid-March. Related Reading: Crypto Analyst
Predicts 28,900% Rally To $154 For XRP Price, Here’s When As such,
Bitcoin appears to be entering a critical juncture in its current
bull cycle. The consolidation and re-accumulation that has
dominated the market in recent months could soon give way to the
next parabolic surge, should historical patterns hold. As of
now, BTC has gained 2% in the past 24 hours, adding to its 10%
positive movement in the past month alone. Bitcoin is currently
trading at $70,200. Featured image from Shutterstock, chart
from TradingView.com
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