Analysts explain why Bitcoin is ready to enter a bull market again

Published on by Cryptoslate | Published on

At long last, Bitcoin has shown signs of life, rallying by 20 percent from the $6,800 bottom put in nearly two weeks ago.

Although this recent price action has been deemed a "Relief rally" by some analysts, more and more indicators suggest that BTC and the rest of the cryptocurrency market are on the verge of returning to a decisively bullish phase.

Over the past few weeks, analysts have been struggling, questioning if the leading cryptocurrency actually established a macro bottom at $6,400 in mid-December, when it surged decisively off that level in an immediate 20 percent bounce.

As he depicts, Bitcoin's recent price action and the one-week Relative Strength Index underwent the exact same pattern they did in the previous market cycle, with there being an RSI break under 40 in a bear market, then a relief rally, and perfect re-test of 40 to kick off the next bull market.

Not to mention, Murad Mahmudov, CIO of Bitcoin fund Adaptive Capital, recently observed on Twitter that there is nearly no way BTC is falling much further than it already has, because "As crazy as it sounds, the -53 percent drop from $13,888 to $6,410 wasn't a full out bitcoin bear market, but rather, unironically just mid-bull cycle correction."

This assertion can be corroborated by on-chain data from Mahmudov's partner, Adaptive Capital's Willy Woo, who wrote in a crypto-viral tweet that Bitcoin's investor activity data is showing clear signs of bull market reaccumulation.

No, we are in the re-accumulation phase of a bull market.

While the bottom is confirmed, are there signals suggesting Bitcoin is soon to explode higher? Per a number of prominent traders, there are many.

The Lucid Stop and Reversal system recently printed a buy signal on Bitcoin's weekly chart for the first time since March 2019, prior to the 330 percent rally that shocked the collective cryptocurrency world.

On the less technical side of things, Bitcoin is now four or so months out from its next block reward reduction, known as a "Halving" or "Halvening." Prominent investors, including former Goldman Sachs employees, have suggested that this event will affect BTC's supply-demand dynamics in a way that will push prices dramatically higher, as covered in this CryptoSlate report.

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