Bitcoin started a massive rally after finding support in the middle of the $16,000 price level. Since then, BTC has surpassed the 100-day and 200-day moving averages of $18K and $19.6K.
After a prolonged downtrend, the price breaking above the 200-day EMA is an important bullish sign for the market. If the bulls maintain the MA-200 level, sufficient demand is likely to return to the market and the short-term sentiment will continue.
However, there is a clear bearish divergence between the price and the RSI on the daily time frame, which may lead to the need for a correction in the coming days and after the rally.
4 hour chart
Professional traders use pivot points to identify support and resistance levels. Simply put, the pivot point is the level at which the direction of price action can begin to reverse.
The following chart shows that BTC price recently crossed two important pivot points and is consolidating around the $23K level. The next crucial resistance level for Bitcoin is the next major pivot At a price level of $25,000Which has also been a consistent resistance level for the past few months.
However, a bearish divergence is also seen in the four-hour period. There is a higher possibility that the price will enter a short-term consolidation phase between $23k and $21k before rising towards the crucial $25k resistance area.
The following charts provide an overview of the last four bitcoin price cycles, including the bull and bear markets in 2017-2018 and 2019-2023. It contains the price of bitcoin along with the MVRV metric, which indicates the ratio of market capitalization to realized capital, which indicates whether the price is overvalued.
Historically, the metrics are in the green during bear market phases, meaning that Bitcoin is trading in the undervalued portion and the bottom of a cycle is forming. However, as the chart shows, bitcoin has been on the rise every time the MVRV scale rises above 1, and the bull market begins.
The recent rally in Bitcoin has led to a sharp increase in the MVRV metric. Therefore, the market may have entered a bullish phase in the medium term, followed by sudden movements and increased volatility.
The post appeared after Bitcoin Rally, This is BTC’s Next Major Target (Price Analysis) debuted on CryptoPotato.