Crypto traders had a brief opportunity to pause and take stock of where things are on June 16 as the relentless selling that has hammered Bitcoin (BTC) and the wider market over the past week began to relent despite an ongoing sell-off in the traditional markets.
Data from Cointelegraph Markets Pro and TradingView shows that after climbing to a high of $23,000 in the early trading hours on June 16, the price of Bitcoin slowly trended down on diminished trading volume to hit a low at $20,765.BTC/USDT 1-day chart. Source: TradingView
Here’s what several analysts in the market are saying about the outlook for Bitcoin moving forward as crypto traders try to determine if the bottom is in or if there is more downside ahead.
Expect multi-month consolidation at the 200-week MA
A macro perspective of the journey that Bitcoin has taken over the years and how its past can offer insight into the current market setup was discussed by analyst and pseudonymous Twitter user Rekt Capital, who posted the following chart highlighting BTC’s behavior near its 200-week moving average (MA).BTC/USD 1-week chart. Source: Twitter
Rekt Capital said,“If #BTC continues to hold the orange 200-week MA as support and the black 200-week EMA figures as resistance… $BTC could form an Accumulation Range here, just like in 2018. This would enable multi-month consolidation to even as far as December 2022.”
If this is the scenario that plays out, then crypto traders need not rush to accumulate BTC, a point noted by crypto trader and pseudonymous Twitter user Altcoin Sherpa, who posted several charts highlighting the amount of time that BTC spent in previous accumulation phases.BTC/USD 1-week chart. Source: Twitter
The longest accumulation period noted by Altcoin Sherpa is the 287 day span outlined in the chart above. Other examples provided include the 133 days of accumulation between November 2018 and April 2019 and the 63 days of accumulation between May 2020 and July 2020.
Altcoin Sherap said,“It’s likely that you will get plenty of time to catch a bottom during the accumulation phase. #Bitcoin takes a while for its bottom to form and you should probably just go out and touch some grass instead of knife catching.”
Bitcoin could reclaim $25,000, if we’re lucky
A more positive take on the latest developments for Bitcoin was offered by crypto trader Nebraskangooner, who provided the following chart noting that the “lower Fibonacci level has been reached.”BTC/USDT 1-week chart. Source: Twitter
Nebraskangooner said,“Let’s see if daily can close strong above resistance and then we have a chance for $25,000 and possibly mid $30K’s. For the first time in months we might finally be ready for the bounce everyone has been calling for since $40K.”
Related: Further downside is expected, but multiple data points suggest Bitcoin is undervalued
The RSI 1000 provides a bullish sign
Another trader who has spotted a potentially bullish signal on the chart for BTC is pseudonymous Twitter user TAnalyst, who posted the following chart highlighting the recent low for the relative strength index (RSI) 1000.BTC/USD vs. RSI 1000 1-day chart. Source: Twitter
TAnalyst said,“#Bitcoin It is only on bottom days, BEFORE BULL RUNS, that the daily RSI(1000) is below 50. Today : RSI(1000) = 49.91. Conclude.”
Based on the history of an RSI 1000 score falling below 50, the price of Bitcoin could soon begin to climb higher.
Perhaps the best summary of the current state of the Bitcoin market and the confusion it is causing crypto traders was offered by crypto educator IncomeSharks.
#Bitcoin– At a price where shorting no longer makes sense. But also at a price that longing is still very risky. Unless using tight risk management this is a spot buy only zone for majority. It’s ok to wait for a trend to develop to start trading again.— IncomeSharks (@IncomeSharks) June 16, 2022
The overall cryptocurrency market cap now stands at $905 billion and Bitcoin’s dominance rate is 44.3%
The views 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 conduct your own research when making a decision.