The first week of June was interesting for Bitcoin. As we entered the last month of Q2 2020, the largest digital asset attempted, for the fourth time in 4 weeks, to break its psychological resistance by $10,000. Just like the last four times, the asset managed to surpass the range but failed to retain its position. Within a 24-hour window, Bitcoin slumped by $500, and at the time of writing, the valuation amounted to $9650.
However, unlike the past three times, the value of Bitcoins has risen to $10,400, testing the yearly high of 2020, according to Arcane’s weekly update. The re-test suggested that Bitcoin could further aim to re-test at the same mark in order to make it stronger than $9,500.
Alongside the price, another bitcoin on-chain metric witnessed a trend reversal.
The above chart illustrates that, after consecutive weeks of declining volume, the 7-day average real trading volume of Bitcoin registered a definite surge. The report indicated that strong trading activity over the coming weeks could be essential for the price to sustain its underlying buoyant momentum. Any price pump could possibly be triggered by these key activities. However, the assertion may not be completely necessary.
Strong Bottom before Yearly-Highs
One of the main reasons why Bitcoin has plummeted dramatically over the last two weeks of February is due to its urgency from 1 January to 14 February 2020. The price went from $6700 to $10,450 in a flash without setting up a strong bottom. Any healthy market requires consistent market correction periods to breathe. Once a position has been maintained at a certain distance, it will embark on another rally.
At the moment, we could be witnessing something similar. Rather than continuing high trading volume or increasing 7-day average trading activity, it is more important for Bitcoin to remain above the current $9,500 support.
If the price loses support at $9,500 and falls below $9,200, the selling pressure could drag the asset down to $8,000. It remains imperative, therefore, that Bitcoin maintain its current position.
Bitcoin Volatility on the rise
After the low volatility level after the end of Bitcoin has halved, the 7-day volatility is now again above the 30-day average, indicating a volatile period in the future.
The uptick could have been due to the fact that BTC went up by 10 percent and shaved 10 percent right after 24 hours, so the volatility needs to be observed over the next few days. Another outburst may trigger a breakout in either direction, depending on the purchase or sale of the pressure momentum.
