After hitting a year low of $ 17,774 in mid-June, Bitcoin has gained a steady upward trajectory for the past two months.
It also recently managed to cross the $ 24,000 mark. This indicated that the selling pressure on the king’s money took a back seat.
However, a turnaround occurred on August 18, which drastically reduced the price of Bitcoin to nearly $ 21,000, once again creating a panic in the cryptocurrency community. However, several parameters appeared in favor of the upside.
For example, Bitcoin’s balance on exchanges hit a four-year low of 2,342,202,837 BTC. Hence, suggesting a bull market environment.
So you may be asking: with this new development, is there a chance of an upcoming bullish rally?
Looking for an answer
After seeing a rise in mid-July, BTC’s trade balance gained momentum to the south and hit a four-year low despite recent price movements.
Source: Glassnode
Furthermore, the 24-hour BTC price chart also supported the bulls when it turned green.
At the time of writing, Bitcoin was trading at $ 21,343.01 with a market cap of $ 408,324,544,759.
A slight recovery was observed as BTC showed positive performance growth of 1.15% on the last day.
Source: CoinMarketCap
Additionally, the number of Bitcoin addresses with non-zero balances also increased from 42,643,752 to 42,699,265 on August 22. This suggested that investor confidence in BTC did not suffer despite its price volatility.
Source: Glassnode
On the other hand, the MVRV ratio plunged concurrently with the price and hit the month low of 0.9617, after which it rebounded upward.
Now, at the time of writing, the MVRV ratio was less than one mark.
Source: Glassnode
To move on
BTC’s 4-hour chart has highlighted some insights for long-term traders.
A bullish ascending triangle pattern has formed, indicating a possible rise in the short term. Furthermore, the MACD also showed a bullish crossover on August 21.
Source: TradingView
Now, the Bollinger Bands have indicated that after being in a high volatility zone for a while, the price of BTC could take a hit. Therefore, minimizing the possibility of a northward breakout.
Furthermore, the exponential moving average (EMA) tape also complimented the Bollinger Bands data as the 55-day EMA was well above the 20-day EMA, indicating a bearish advantage in the market.