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Parabolic rally in the making? Bitcoin Gains $70,000 as Traders’ Paper Profits Drop to 3% — TradingView News
The world’s largest cryptocurrency, Bitcoin (BTC), has consolidated over the past week, trading between $67,000 and $70,000 after suffering a brief 20% price correction that took it to just $56,400 early on. of May.
This period of consolidation comes as inflows into the U.S. Bitcoin ETF spot market have reignited and selling pressure appears to have cooled, both in the ETF market and among Bitcoin investors in general.
Bitcoin selling pressure eases
According to Julio Moreno, head of research at on-chain market analysis firm CryptoQuant, Bitcoin’s current price level of $70,000 is different from when it last reached that level in March.
Moreno notes that traders are now applying much less selling pressure, as unrealized profits are only around 3%, compared to 69% in early March. This suggests that much of the “heavy selling” has dried up, as shown in the chart below.
BTC News
Santiment data also shows that Bitcoin once again surpassed the $70,000 market cap, even as the US stock market took a break for the Memorial Day holiday.
Market intelligence platform Santiment sees this as an encouraging sign, as it demonstrates BTC’s ability to perform well on days when it is not closely correlated with the primary stock market, as has been the case for much of 2022.
Final pre-breakout consolidation phase
Despite this positive momentum, crypto analyst Rekt Capital noted that Bitcoin’s latest weekly candle closed below the high resistance range of its ongoing “reaccumulation” phase, which extends from around 60,000 to $70,000.
This likely condemns the leading cryptocurrency to further consolidation within this range, in line with Rekt Capital’s thesis that two phases remain in the current bull cycle: the post-halving reaccumulation 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 bullish cycles. According to the analyst, Bitcoin has actually been consolidating at these highs for quite some time now, especially compared to the standards of previous cycles.
While there is still room for further sideways trades at these elevated price levels, the time remaining at this stage is slowly running out. This leads one to believe that the long-awaited post-Halving rally, combined 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.
Therefore, it appears that Bitcoin is entering a critical juncture in its current bull cycle. The consolidation and reaccumulation that have dominated the market in recent months could soon give way to the next parabolic surge, if historical patterns hold.
As of today, BTC has gained 2% in the last 24 hours, adding to the 10% positive move seen in the last month alone. Bitcoin is currently trading at $70,200.
Featured image from Shutterstock, chart from TradingView.com