BTC price analysis

NVT is a “buy the dip” opportunity that few ever get access to this week, one analyst says, as BTC/USD stays in the mid-$40,000 range.

Bitcoin (BTC) is facing a make-or-break moment this week as a classic indicator signals a price watershed. 

According to the network value to transaction (NVT) price, BTC/USD is in line for a reset at recent lows of just above $42,000.

NVT calls a significant BTC move

After dipping on negative sentiment as a result of tweets from Elon Musk, Bitcoin is attempting to establish definitive support near its old all-time highs from February.

At the same time, NVT, which is used to discover potential local price polarities, suggests that the market is looking at an event similar to early 2018 or last March’s cross-asset crash.

The start of 2018 heralded a year-long bear market, while last year, Bitcoin conversely bounced from lows to new all-time highs — a bull run that analysts argue is still in action.

With the $42,000 dip bringing Bitcoin below NVT price, however, statistician Willy Woo drew attention to similar events throughout its 12-year history.

“Here is some hopium for those of you losing your minds,” Filbfilb, co-founder of trading suite DecenTrader, added about the indicator.

A “buy the dip” like few others?

As Cointelegraph reported, NVT and its derivatives correctly called the explosive growth of Q1 2021.

NVT is far from the only tool in bulls’ arsenal for calling a continuation, however, and fresh data is also highlighting a distinct difference between old and new BTC hodlers.

The price dip, for instance, came as recent buyers sold in panic, overwhelmingly at a loss. Older entities, by contrast, happily bought up the available liquidity.

“Translation: BTFD opportunities like this don’t come often,” analyst William Clemente flatly commented on the NVT data.

Bitcoin saw a real test of its market composition on Thursday amid a sea of liquidations reminiscent of the events from last year.

Bitcoin (BTC) has performed "very well" as traders send more coins to exchanges than at any time since the March 2020 crash.

Data from on-chain monitoring resources CryptoQuant and Glassnode shows that BTC exchange inflows hit a one-year high on May 13.

Nearly 30,000 BTC hits exchanges

Bitcoin saw intense pressure from sellers this week as multiple news triggers combined to turn many bearish.

Tesla abandoning BTC payments, followed by rumors of an investigation of major exchange Binance by United States regulators, was enough to send BTC/USD to lows of $46,000 before stabilizing.

As Cointelegraph reported, the dip could have been considerably worse, with longer-term price features providing support at crucial levels.

Nonetheless, $50,000 remains out of reach at the time of writing, as hodlers lick their wounds and assess Bitcoin's likely next move.

Data tracking trader behavior reveals the scale of the sell-off and likewise suggests that Bitcoin, in fact, weathered the storm rather well.

Inflows to exchanges hit 30,000 BTC ($1.47 billion) on Thursday, while liquidations totalled $200 million in just one ten-minute period during the height of the price volatility.

"Yesterday was the largest day of exchange inflows since the March crash last year," analyst William Clemente summarized on Friday.

"BTC held up very well given this and $200M of liquidations in 10 minutes."

Whale warnings

Inflows to exchanges reflect the desire to sell BTC at short notice. Some may not divest themselves of their holdings for cash, but rather take a stablecoin position and then buy back in once prices stabilize. As such, outflows may soon begin to rise, as panicky investors join those "buying the dip."

Continuing the analysis, however, Ki Young Ju, CEO of CryptoQuant, highlighted whales still sending coins to exchanges more than usual as a potential sign that the bearish phase is not yet over for good.

"If you're a derivative trader, be careful in the short term. (Relatively speaking) whales are depositing $BTC to exchanges," he told Twitter followers.

Time to buy or wait and see? Bitcoin may have further to fall but long-term price trends are still intact.

Bitcoin (BTC) dipped below $50,000 again on May 13 as the fallout from Elon Musk's criticism continued to resonate.

Traders wait for telltale buy signals

Data from Cointelegraph Markets Pro and Tradingview confirmed BTC/USD failing to establish $50,000 as support after initially dipping to $45,650.

Musk, speaking as CEO of Tesla, had claimed that environmental concerns meant that the company would no longer accept BTC payments. 

After a three-hour slow crash, BTC/USD then rebounded to near $52,000 before losing steam once more. At the time of writing, the pair traded at around $49,500 amid heavy volatility. 

As Cointelegraph reported earlier, however, Bitcoin price trends beyond the short term remained unchanged by Musk and traders' responses to him. 

For popular trader Scott Melker, it was thus time to use an established method for determining when the price floor was likely to hit.

For this, he used the relative stength index (RSI), a classic indicator of overbought or oversold areas.

"I post this every time 4 hour RSI goes oversold and it works more times than not. An overbought bear div was the top," he told Twitter followers.

"Now I want to see a lower low in price and a higher low on RSI. Could be this candle or take days, but it's the signal I want."

Thursday had already seen Bitcoin cancel its downtrend when it encountered the 21-week exponential moving average (21EMA). This line in the sand had held throughout the past year's bull market and that of 2017, and is thought to provide reliable support for periods where bullish momentum sees a short-term retracement.

The 21EMA was still rising steeply this month, demanding that BTC/USD thus returns to setting higher highs and higher lows on weekly timeframes in order to preserve its usefuless.

Previously, a warning had given $40,000 as a potential low should $50,000 fail to hold.

Bitcoin bears battle essential moving average

Meanwhile, as investors rushed to "buy the dip," attention turned to where large clusters of bids from whale buyers might also help buoy the price.

Bitcoin had paid no attention to whale positions north of $50,000, despite plenty of buying occuring as high as $58,000. 

For monitoring resource Whalemap, however, the number of coins being transacted at a loss suggested that "panic" was already visible on the market even before the Musk episode.

"These moments have historically been good buying opportunities as they indicate panic on the market," part of a tweet on Tuesday explained.

A look at buy and sell order configurations on Binance additionally showed retail investors now protecting $45,000, with $55,000 and upward becoming strong resistance.

Bullish news kickstarts a lackluster Bitcoin after an overnight slump neared $53,000 and altcoins kept surging.

Bitcoin (BTC) staged a characteristic comeback on May 5 as a day of losses turned around in a flash.

BTC price nears $58,000

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD passing $57,000 again during Wednesday trading, with daily gains knocking on 5%.

The move marks Bitcoin's second such "comeback" in a week. While the bearish trend reset, analysts were keen to see how much fuel Bitcoin had accumulated after dipping to near $53,000 overnight.

For Philip Swift, co-founder of trading suite Decentrader, fundamental indicators still pointed to a continuation of the longer-term bull market.

"I continue to think that Bitcoin will not crash and is more likely to range before breaking out to the upside," part of a series of tweets read on the day.

"Many other indicators suggest $BTC has much more upside and the cycle is not over."

Swift specifically noted that one tool, the Pi Cycle Top indicator, had "nailed" Bitcoin's most recent all-time high of $64,500 in April. As Cointelegraph reported, Pi has become increasingly popular for those tracking BTC price trends over successive years.

At the time of writing, BTC/USD circled $57,200, ruminating after reaching local highs of $57,400.

No plain sailing for altcoin bagholders

Hodlers thus received a welcome response from the largest cryptocurrency, which had spent much of the week being humiliated at the hands of a surging altcoin market.

Among the astonishing movers were tokens such as Dogecoin (DOGE) and Ethereum Classic (ETC), the latter having laid dormant for much of the past three years since the end of the previous broad "alt season."

Words of caution, veiled or not, were nonetheless not in short supply, as Bitcoin proponents warned about the fickle nature of such parabolic altcoin moves.

Bitcoin dragging all markets down as people flee to superior assets such as Dogecoin.

— ∞ CO฿IE (@CryptoCobain) May 4, 2021

Acting in Bitcoin's favor meanwhile was news that it would be supported by "hundreds" of banks in the United States in 2021, along with investment giant Grayscale becoming a sponsor of NFL team the New York Giants. 

"What we’re doing is making it simple for everyday Americans and corporations to be able to buy bitcoin through their existing bank relationship," said Patrick Sells, head of bank solutions at crypto custody firm NYDIG, which is behind the scheme, revealing the scale of the rollout to CNBC.

Bitcoin is recovering, and traders are pinpointing $57,000 and $60,300 as the key short-term price levels to watch.

The price of Bitcoin (BTC) is recovering after a strong sell-off during the weekend caused by cascading liquidations in the futures market.

Traders are pinpointing three levels as the critical price areas to watch in the short term: $51,200 as the major support, $60,300 as the important resistance, and $57,000 as the near term area of interest for sellers.

It is critical for Bitcoin to reclaim $57,000

Although the price of Bitcoin dropped to as low as around $50,000, the market structure itself does not look largely concerning, according to a pseudonymous trader known as TraderKoz.

Bitcoin wicked to sub-$50,000, but it recovered quickly to around $53,000 and has sustained above $56,000 since.

Referring to the chart above, the trader said:

“You know, if this wick wasn’t quite as long because of all the cascading liquidations... it would actually be some really clean PA.”

In the near term, it is important for Bitcoin to rise and hold above $57,000. If BTC’s price stabilizes at these levels, it would confirm that the weekend crash was a purely technical and futures market-driven correction.

Popular pseudonymous trader Rekt Capital also emphasized that the macro support remains at $51,200. Bitcoin recovered quickly as soon as it dropped to the low $50,000 area.

Therefore, Bitcoin will confirm a higher low structure if it continues to recover in the short term and does not drop below $51,200.

A higher low structure forms when the most recent Bitcoin low is higher than the previous low point.

The trader explained:

“Last time #BTC dipped into the low-$50000s was four weeks ago Then, $BTC dipped to ~$50200 before reversing Recently, BTC dipped to the low-$50000s again This time, BTC dipped to ~$51200 before reversing BTC bottomed $1000 higher on this dip. That is a Higher Low.”

Additionally, analysts at Santiment noted that BTC recovered rapidly immediately after the funding rate of Bitcoin on BitMEX went negative.

This indicates that significant organic buyer demand emerged when selling pressure started to amp up in the derivatives market, which would support the argument for a short-term trend reversal as long as Bitcoin remains above $57,000.

The analysts wrote:

“The #BitMEX funding rate for #Bitcoin went negative (more contracts betting against $BTC’s price rising than contracts betting in favor) this weekend for the first time in 3 months. As is often the case, the price bounced right as the #FUD settled in.”

Will the relief rally continue?

There were large deposits made to exchanges when the price of Bitcoin dropped, adding to the selling pressure.

But, as pointed out by Bitcoin Jack, a cryptocurrency derivatives trader, exchange withdrawals or outflows exceeded the deposits nevertheless.

He said:

“April 15, 16 and 17th $BTC saw ~482K addresses deposit to exchanges Same period ~220K addresses were withdrawn to from exchanges & net positive outflow recorded Many tiny hands in -> fewer bigger hands out Confirmed by short term holder SOPR capitulation.”

As long as exchange withdrawals are on par or higher than exchange deposits, the technical momentum of Bitcoin is not at risk of losing steam in the near term.

Consolidation after fresh all-time highs means now is the time to buy BTC in “wildly bullish” conditions, argues Vailshire Capital.

Bitcoin (BTC) looked set to retest previous all-time highs on Thursday as a fund manager called it a “great opportunity to buy.”

Cointelegraph Markets Pro and TradingView showed a 3.3% daily comedown for BTC/USD taking aim at new support levels on Thursday.

Bitcoin outlook “wildly bullish”

After surging to nearly $65,000 on Monday, Bitcoin began to consolidate in a new range as the buzz around Coinbase’s successful Nasdaq listing cooled.

At the time of writing, the largest cryptocurrency traded at around $62,600, around $700 higher than March’s record of $61,700

This area, Vailshire Capital Management CEO Jeff Ross believes, should now set the scene for a support-resistance flip, which, if successful, will allow BTC/USD to continue rising.

“Healthy retest of previous consolidation wedge ceiling. Macro view: Wildly bullish. On chain analytics: Wildly bullish,” he wrote on Twitter on the day.

“Opinion: Price should close above old ‘ceiling’ of ~$61,250, then surge higher. Great opportunity to buy before next leg higher.”

Sellers cool off under $70,000

A look at exchange order books appeared to confirm appetite even among ardent sellers for allowing Bitcoin a few thousand dollars’ further growth on short timeframes. 

On Binance, sell orders were lined up first at $65,000, with a more significant band of resistance now in place at $70,000 and $72,000.

Those upper levels have long been the focus of analysts, with one even describing them as “destiny” for the short term.

Other on-chain metrics showed sustained engagement from investors across the board, with the total number of Bitcoin wallet addresses containing 0.01 BTC or more passing 9 million for the first time. 

Bitcoin broke above $61,000 for the first time since early March and traders are turning bullish.

The price of Bitcoin (BTC) has surpassed $61,000 on April 10 for the first time in nearly a month. Following the breakout, traders are starting to look at new levels of resistance and support in the short-term as optimism returns to the market.

In the near term, besides the all-time high at around $61,800, there are three key Bitcoin price levels to observe: $61,188, $58,387 and $53,000.

As long as the price of Bitcoin stays above $58,387 and keeps attempting to break out above $61,188, it would likely see a new record high in the foreseeable future.

If Bitcoin breaks out to a new record high, traders also anticipate the altcoin market to pullback slightly for the time being, at least until BTC starts to stagnate after reaching a new high.

$58,000 flipping into support is critical for more upside

According to the pseudonymous trader "Rekt capital," the key for Bitcoin to cleanly reach a new all-time high in the coming days is to solidify $58,000 as a support area.

The $58,000 level is an important area because it marks the peak of the initial BTC rally to the $60,000 resistance level in mid-February, as shown in the graph below.

In technical analysis, when the price of an asset stabilizes above the previous peak, it is considered to be a very bullish sign.

The trader noted:

"BTC was able to still keep the red area even though it rejected from orange And in fact, the rejections from orange has been weaker Right now, BTC is pressing beyond orange [$58,000]. Turning orange into a support would bring Bitcoin very close to a new All Time High."

Raoul Pal, the CEO of Global Macro Investor, emphasized that the macro view of Bitcoin remains positive.

Pal emphasized that Bitcoin broke out of a three-month range, which indicates that BTC's technical momentum is starting to regain steam. He said:

"Kind of feels like a big deal to see BTC break a 3 month range and a wedge. It should create a powerful move to the upside. (Axis scrunched on chart to hint at the upside for dramatic effect."

A cryptocurrency derivatives trader "Cactus" also added that on-chain analytics are stronger than ever, considering that large BTC exchange outflows indicate accumulation among high-net-worth investors.

$BTC / USD

Seeing some huge bullish momentum for BTC...

- On-chain analytics are stronger than ever
- We are seeing biggest exchange outflow's ever
- Previous monthly close is now support
- Highest weekly close ever likely to be printed pic.twitter.com/zovWNVrKuS

— Cactus (@TheCryptoCactus) April 10, 2021

As Bitcoin rallies, beware of altcoin stagnance

Meanwhile, other traders are expecting the altcoin market to take a breather if Bitcoin enters price discovery once again.

Kaleo, a well-known pseudonymous trader, said that there is a high chance altcoins do not rally nearly as much as expected when the volume is sucked up by Bitcoin.

The trader explained:

"For those that are new, be careful being to deep into alts when $BTC is on the brink of price discovery. Profits from alts tend to flow back into Bitcoin. This doesn't mean the USD price won't go up, just that there's a solid chance it won't go up nearly as much."

In the short term, Bitcoin would likely outperform altcoins if it continues to rally, and the momentum would only shift to altcoins once BTC consolidates as it finds a new range after breaking new highs.