DataDash's host said that Bitcoin could bounce back from its recent losses in a new market replacement. Merten told his YouTube followers that the cryptocurrency could bounce back similarly to what happened in July of 2021.
According to Merten, the main moving averages of Bitcoin suggest that the currency could be in the midst of a potential aid rally to the $30,000 level.
"We rallied all the way in which from $29,000 to $53,000 [in July 2021]," Merten said. "To place that into perspective, in a matter of only a few weeks, or just put, lower than months, we noticed an 80% transfer in Bitcoin's worth. Am I calling for that precisely? No, what I'm calling for is for us to return up and to retest this earlier consolidative vary [$30,000]."
The main support level for Bitcoin is at $30,000, and the moving averages are currently moving towards this area, which provides an ideal setup for the currency to bounce back.
"There isn't a vital factors of resistance right here, and the transferring averages are coming straight down into this level the place it provides us an ideal setup for Bitcoin to return up and retest this vary right here, and see if it will possibly work together with these transferring average." Marten said.
Merten additionally said that it would be surprising how the rally could get exacerbated due to the existence of so many derivatives.
"Lots of people received't suppose it will possibly occur," the analyst continued. You'd be shocked how aid rallies can get to an exacerbated degree, particularly in a market the place there [are] extreme quantities of derivatives."
When I read Glassnode reports bitcoin leaving exchanges, I was always like "huh?" The graph below explains it. Over shrinking, but Binance (and BFX) growing.— CZ 🔶 Binance (@cz_binance) July 23, 2022
Also shows relative size of exchanges, on this dimension. pic.twitter.com/7CPWhUJOQp
Remain cautious, Marten says
Although Merten had a positive outlook that Bitcoin could be amid an aid rally within the next couple of days, he remained cautious about the possibility that the highest market cap asset could still fall.
Many people believe that the market is in the midst of a massive sell-off, and Marten stated that a lot of these are coming from the extreme credit score and leverage that people had utilized to borrow cryptocurrencies.
"We clearly have had a really dramatic sell-off right here, and a pleasant rebound at that, plus we've actually flushed out numerous the leverage and numerous the extreme credit score that folks had utilized with a purpose to borrow cryptocurrencies to invest," said Marten to encourage his audience to be cautious.
Marten stated that the market is still in a significant bear market, and it will likely suppress the long-term capital allocation of cryptocurrencies.
A crypto analyst noted that Bitcoin dominant buyers have maintained a holding pattern regardless of the current market situation. In a CryptoQuant post on July 24, CoinSignal365 stated that two groups of Bitcoin whales experienced a sharp increase in their holding pattern. Regardless of the currency's price fall, these groups of Bitcoin whales purchased the dip.
Despite the various sideways moves throughout the previous couple of months, more than Bitcoin holders who have 1,000 in their account continued to increase their holdings.
The number of addresses that hold 0.01 of Bitcoin also reached an all-time high of 10,543,548. This demonstrates the dominance of Bitcoin whales. Such accumulation can help boost the price of the currency.