After a brutal crash last weekend, the Bitcoin (BTC) price bounced back surging past $20,000. On Tuesday, as BTC attempted to march forward above $21,500, it faced resistance and has retraced since.
As of press time, Bitcoin is trading at $20,474 with a market cap of $390 billion. For Bitcoin to sustain the upward momentum, it has to reclaim its 200-week moving average of $22,500 and turn it into support.
#BTC would need to break above ~$22500 for a chance at reclaiming the 200-week MA as support$BTC #Crypto #Bitcoin pic.twitter.com/EV64baWFLw
— Rekt Capital (@rektcapital) June 21, 2022
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Crypto market analyst Rekt Capital further explains: “If BTC can’t reclaim the 200-week MA as support… Then one of the scenarios of what could happen would involve downside to new lows before the formation of an Accumulation Range for the first time below the 200-week MA”.
Bitcoin miner capitulation at its peak. Last week, Bitcoin miners sold nearly 9000 BTC to cover their operational costs. there was a huge spike in the miner to exchange flow. Popular Twitter handle @OnChainCollege notes: “Miners capitulating is a sign that you want to see in bear markets. It could still take months, and more decline, to find that bottom”.
Bitcoin Supply at Exchanges
Looking at the positive side of things, Bitcoin supply at the exchanges is at a 3.5-year low as per on-chain data provider Santiment. The data provider adds:
“The ratio of #Bitcoin‘s supply continues to stay low at levels last seen in November, 2018. This is a good signal of limited future selloff risk. In the meantime, supply continues skyrocketing on to exchanges, indicating greater buying power”.
The fact that Bitcoin (BTC) is already trading at a 70% discount from its all-time high is a good signal for long-term players to accumulate. Instead of spotting the exact bottom, long-term investors can start Dollar Cost Averaging at this point to reap healthy profits four years from now. It will be interesting to watch how long Bitcoin continues to hold its $20,000 support levels.
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