According to a well-known analyst, it is highly improbable for Bitcoin to view its climb to $29,000 as a random and temporary surge. On June 21, Bitcoin (BTC) experienced a slight dip, with its value currently at $28,927, after reaching the $29,000 mark fueled by significant purchasing activity, which further enhanced market sentiment.
Bitcoin Analyst Deems $29,000 Fakeout Highly Unlikely
According to data obtained from Markets and TradingView, the BTC/USD pair surged to $29,014 on the Bitstamp exchange, marking its highest level since May 7. The pair experienced sustained interest from buyers throughout the night, which can be attributed to various announcements regarding new institutional investment products centered around Bitcoin.
Analysts, who had previously expressed worries about the overall strength of the market, found reason to reconsider their views due to the recent developments. Rekt Capital, a well-known trader and analyst, responded by expressing enthusiasm for the impressive breakout of BTC, surpassing the downward trend that had persisted for several months.
On the previous day, despite the upward movement already taking place, Rekt Capital had issued a warning that a significant change in trend would only be confirmed with the closing of the weekly candle. He emphasized the importance of BTC surpassing the multi-month downtrend in order to validate a breakout. However, he now added that for complete confirmation of the breakout, it would be ideal for BTC to experience a temporary decline and successfully retest the downtrend.
In the meantime, Crypto Tony, another trader, shared his perspective that Bitcoin had the potential to reach his target for upward movement earlier than he originally expected. He reasoned that if the support zone at $25,000 was not breached, it indicated that bearish control over Bitcoin had not yet materialized.
Some individuals took a more cautious approach, including Daan Crypto Trades and Michaël van de Poppe, the founder and CEO of trading firm Eight. They disclosed that they had closed their long positions when Bitcoin reached the $29,000 level. However, Van de Poppe still expressed his belief that BTC/USD was heading towards $38,000 or even higher.
Glassnode, an on-chain analytics firm, seized the opportunity to emphasize the importance of the short-term holder (STH) cost basis when it came to support levels. With the STH cost basis standing at $26,400, it became a crucial threshold for Bitcoin and USD trading. Glassnode pointed out that BTC/USD showed a robust recovery after short-term holders entered the unrealized loss territory. They further tweeted that the level of $26,550 continued to play a significant role in determining the overall market trend.
The mid-$26,000 range is currently where the 200-week moving average, which serves as an important support line during bear markets, can be found.