Similar to Stockholm Syndrome, where captives develop a psychological bond with their captors, crypto winters have a way of flipping even the most die-hard crypto supporter down in a short period of time.
Evidence for this reality came to light in full on July 19 after the Bitcoin (BTC) recovery back above $23,000 was met with widespread warnings that the move was a bogus hoax before the market headed towards new lows.
While the possibility of new lows in the future cannot be ruled out, here is a look at what analysts are saying on how this BTC breakout could be different from what most investors are expecting.
This time, it’s different.
The pointed message “This time is different” was provided by the pseudonymous Twitter user Trader XM, who posted the following chart showing why BTC is ready to head higher.
4 hour BTC/USD chart. Source: Twitter
As shown in the chart above, the price of BTC did not retest the lower range even with four tests to retest the higher range, and this indicates that the buyers are now stronger than the sellers.
In response to the post from Trader XM, Twitter user Justiinape replied, “$27K-$28K looks imminent.”
XM Trader said:
“Okay man, go for $27-28K and then months of consolidation. Let’s enjoy this move before the long hibernation.”
Next major resistance at $27,100
Additional evidence that BTC could head higher was provided by the on-chain data company Whalemap, who published the following chart highlighting the lack of buying demand between $23,000 and $27,000.
Bitcoin volume profile. Source: Twitter
Whalemap said:
$27,100 should be the first resistance on our way up. Huge supply gap between current prices and $27,000.”
Related: Bitcoin Price Moves Around $24,000 & Traders Expect More Rally After Retesting Support
Pants You Get REKT
Evidence that crypto traders have calmed into an excessively bearish view was provided by crypto analyst Dylan Leclerc, who published the following chart showing the impact of Bitcoin’s move above $23,000 on futures traders.
BTC/USD 2-hour chart. Source: Twitter
As can be seen in the chart, there were a large number of short bitcoin trades open between June 15 and July 15, and these traders are now finding themselves on the losing side of the trade.
Leclerc said:
“Short open interest worth tens of thousands of BTC is currently under water.”
While a reversal of Bitcoin and a bearish trend again remains a possibility, the current momentum points to further upside in the short term.
The total cryptocurrency market capitalization is now at $1.055 trillion and the Bitcoin dominance rate is 42.1%.
The opinions and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should do your own research when making a decision.
