Bitcoin (BTC) begins the second week of June in familiar territory, but a bullish break is looming, investors say.
After a quiet weekly closure, The BTC/USD pair is holding firm in its stated trading range, while under the hood, market participants are preparing for some drastic swings.
It has been made to wait and, For experienced traders, the signs are increasingly pointing to a return of volatility.
There are few macroeconomic events this week, so the focus shifts elsewhere for clues as to what the BTC price might be doing in the near term.
On-chain analytics provide other interesting insightsreinforcing the idea that the only boring thing about bitcoin these days is the spot price.
Cointelegraph looks at the key factors at play as the BTC/USD pair is around USD 27,000 for another week.
Weekly close preserves key trend line
The BTC/USD pair may not have inspired with its latest weekly close, but some popular traders are seeing new reasons to be optimistic.
“It looks like it’s a matter of time before bitcoin breaks through the $30,000 level once and for all,” wrote the trader Jelle in part of his latest analysis.
Jelle, like others, noted that the 200-week moving average (MA) – a key support line – remained intact.
Several support structures on the radar of trader and analyst Rekt Capital were also intact. that cover daily time frames.
“So far so good,” he summed up on a higher breakout, potentially invalidating a bearish “head and shoulders” structure. of the previous weeks.
#BTC successfully retesting not just the top of the red downtrending channel but also the bottom of the red box
— Rekt Capital (@rektcapital) June 4, 2023
BTC is successfully retesting not only the top of the downtrend red channel, but also the bottom of the red box. So far so good.
An additional tweet mentioned a “successful retest” of support on the horizon.
“BTC fell from a head and shoulders pattern in May. But there is classic whipsaw action around the neck”, recognized the Game of Trades trading account.
“The pattern remains valid unless the price moves above the right shoulder.”
An accompanying chart gave a potential downside target of just $24,000 for the BTC/USD pair due to the head and shoulders pattern.
Others looked for less movement, such as Crypto trader Tony, who eyed $25,300 as a possible destination. if the $28,350 resistance was not broken.
So right now we are consolidating following the drop from the 14th April high. I am looking for
– $25,300 target to look for longs
– Must remain below $28,350 for the downside target
– Combo corrective pattern
I will update daily as always pic.twitter.com/Q93mr4hjGH
— Crypto Tony (@CryptoTony__) June 4, 2023
June / July plan for the BTC/USD pair. Right now we are consolidating after the fall from the April 14 high.
-USD 25,300 will be the target to look for longs
-Must stay below $28,350 for downside target
-Combined corrective pattern
I will update daily as always
Macroeconomic calm arrives… for now
In a week of unusual calm for traders, from June 5 to 9 there will be little macroeconomic data coming out of the United States.
Once the debt ceiling debacle is over, the next potential catalysts for volatility will be May macroeconomic reports, such as the Consumer Price Index (CPI), which will not be released for another week.
With that, The focus is on OPEC+ members’ oil production cuts as prices continue to fall despite existing reductions in production.
For his part, A more direct potential headwind for bitcoin and cryptocurrencies comes in the form of the US dollar.
Greenback strength has been building a bounce since early May, and since then, the US Dollar Index (DXY) -traditionally inversely correlated with risky assets- has gained about 3.5%.
the popular analyst Matthew Hyland noted the rising relative strength index (RSI) scores for the DXY on weekly timeframes.
DXY Weekly opens: pic.twitter.com/nRIGyKm4tl
—Matthew Hyland (@MatthewHyland_) June 4, 2023
DXY weekly opening:
Trader Skew noted that the 104.7% level, the current high from June, is a critical level to close above in order for the DXY to form an uptrend.
“There will be a strong close and move higher in the early stages of the EU session,” commented about the day
“If the USD closes above $104.7, I would view that as USD strength. So far it seems that there is no risk, but we will see later.”
Strong close & moving higher in early EU trading session.
if USD closes above $104.7, I would consider that as USD strength.
So far this looks risk off but we see later on. pic.twitter.com/3SLDs5wtos
— Skew Δ (@52kskew) June 5, 2023
DXY 1-day chart. If the USD closes above $104.7, I would view that as USD strength. So far it seems that there is no risk, but we will see later.
During the weekend, TraderSZ described DXY as “bullish until proven otherwise”.
Stocks Drive the Bullish Case for Crypto
The debt cap resolution had an immediate cathartic effect on equities, but crypto markets have not copied their enthusiasm.
This can still changesay market participants, as the S&P 500 hits 10-month highs.
“The US House of Representatives has passed a key debt cap deal, driving the SP500 to its highest price since August. Altcoins like $LTC, $LEO and $FGC are up today,” wrote research firm Santiment on June 2.
“As cryptocurrencies lag behind equities, BTC could catch up soon.”
An accompanying chart also showed a “bounce” in gold, albeit short-lived.
As Cointelegraph reported, others were also looking at a positive correlation between bitcoin and a resurgence of the S&P 500.
Bitcoin investors are seeing gains
“It’s easy to ‘feel’ that the bitcoin rally is over, but the facts say it isn’t,” wrote popular technical analyst CryptoCon. in its conclusions last month.
At that time, the BTC/USD pair was almost $1,000 above current levels, but enthusiasm was just as lacking.
CryptoCon has been analyzing the state of profitability of bitcoin holders, using the Net Unrealized Profit/Loss (NUPL) metric. created in 2019 by entrepreneur and analyst Tuur Demeester and others.
During the last months, the NUPL has remained practically stationary around a value of 0.25, indicating that, overall, BTC supply is modestly “in the black.”
The NUPL measures the difference between unrealized gains and unrealized losses. It is calculated by gathering the Unrealized Transaction Outputs (UTXOs) and comparing how much the coins are worth now to the last time they moved on-chain.
“Any value above zero indicates that the network is in a net gain state, while values below zero indicate a net loss state. In general, the further the NUPL deviates from zero, the closer the market trend toward highs and lows.” explained analytics firm Glassnode in an introduction.
Although it has been quiet in recent months, NUPL has once again shown a bullish trend, which is cause for confidence, CryptoCon now claims.
“The $31,000 level was not the end, I hope you are ready!”, concluded in an update this weekend.
An accompanying chart of the NUPL showed its performance against investor sentiment at various stages over the past 10 years.
#Bitcoin has seen a lot of sideways price action recently, but during that time two very important things have happened on the NUPL:
– Retest of trend
– Support made on Hope / Fear sector
The next step, a leap to the belief/denial range
31k was not the end, hope you’re ready! pic.twitter.com/yi1GMO1hri
— CryptoCon (@CryptoCon_) June 4, 2023
Bitcoin has seen a lot of sideways price action recently, but during that time two very important things have happened as far as the NUPL is concerned:
– Trend retest
– Support made in the Hope / Fear sector
The next step is a jump into the belief/denial range. The $31,000 level was not the end, I hope you are ready!
The biggest bitcoin whales are in a “dichotomy”
Regarding investor sentiment, the current view of the market varies greatly between the different classes of hodlers.
As points Glassnode, Most Still Not Risking Bitcoin; since May, sales have dominated despite the lack of capitulating events.
The one exception, it seems, is the larger class of bitcoin “whales.”
Sharing a plot of accumulation vs. distribution adjusted by cohort, Glassnode showed that wallets holding at least 10,000 BTC are buying, while everyone else is reducing their exposure to the cryptocurrency.
“An interesting dichotomy persists in the Bitcoin Accumulation Trend Score, as the largest Whales (holding less than 10,000 BTC) continue to accumulate aggressively, while all other major cohorts experience strong distribution,” researchers commented.
The last accumulation phase of these “mega whales” was in late 2022, with the BTC/USD pair beginning its 2023 rebound weeks later.
The whales paused in mid-January, entering its own distribution phase before returning to accumulation in May.
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