Bitcoin Ready for Bull Trap or Moon?

Tin Tức Crypto • 2021/07/29 • bởi

Bitcoin / US Dollar

The recent bullish breakout was an expected reaction from the market as more and more investors were taking long positions in the Bitcoin market, pushing the price towards higher levels. The price climbed to $40,000, which was the upper level of the extended compression zone. The extended compression zone lays between $32,000 and $40,000 and has been the main support level for the current situation.

Breaking the average point at $36,000, the price made a bold statement by reaching $40,000, but there is needed to be done now. At this moment, the market has been on the verge of establishing a core bullish trend or falling into a bull trap.

The bullish trend will be established if the price climbs and breaks the $40,000 resistance level. The next checkpoint for the bullish uptrend will be the $47,000. Many investors remember this level as the entry point for Tesla’s purchase when the price was skyrocketed, and many institutions have followed back then.

Taking down this level will bring an equilibrium in the Bitcoin market as it will show that the price action can recover from Elon Musk’s behavior regarding it.

On the other hand, a bull trap is defined by a sudden drop in the price after the market has surged after a long period of instability. In this situation, investors are looking for the exact moment to pull out their funds once the market rises. This move makes the market correct again at previous levels, bringing the market back to a bearish mood.

The only way to see if the market has avoided the bull trap is to wait until the price continues to rise above the $40,000 point.

The trading volumes made a significant jump over the last days, predicting a core return in the investors’ interest. The moving averages crossed each other and formed a “Golden Cross,” predicting a positive outcome in the next period.

In the short-term diagram, we can observe that the bullish turn in the market wasn’t interrupted by any “red” day until it reached the $40,000 point. This means that the resistance level remains strong and will be on the next period.

Indicators

MACD index has moved massively in the “green” area, bringing more positive momentum in the price formation process. After topping around value = 70, the RSI index moved back to value = 65, indicating that there are still prospects for further uptrend.

Ethereum / US Dollar

Ethereum has made significant progress regarding its return in the bullish side of the market as the price continues to climb above the $2,000 point and reached $2,350 today. This means that there is a little more to be done until the $2,500, which is the checkpoint for entering the bullish market again.

Ethereum was characterized as one of the winners in the previous bullish period, doubling its value over one or two months and exploiting several opportunities in the crypto field. Those facts enabled the price to grow at high levels and sustained its position even at hard times.

The high correlation between Bitcoin and Ethereum has also played an important role in the current phase. We expect Ethereum to attract investments outside of crypto investors, who spread their portfolios in different groups.

A sustainable business model for Ethereum would include organic growth derived from the business model and not from its correlation with Bitcoin. This will give Ethereum the boost to achieve better results in the long term and provide over-returns against other cryptocurrencies.

The trading volumes have made a small spike during the last days while the moving averages made across again, providing the investors with another bullish signal for the next period.

Indicators

MACD index has moved forward in the “green” area, adding more momentum in the price formation. The RSI index moved above value = 60, indicating more space for an uptrend in the short-term future.

Ripple / US Dollar

The uptrend has also been deployed in the Ripple market, as the price climbed above $0.70, proving more work to be done. The space from $0.60 and $1.00 has been especially fragile in the current period as it remains an unexplored area, without much action in it.

This means that every move between the $0.60 and $1.00 points should be recorded for future use and track down its behavior. Many unexplored areas in the crypto markets have given us peculiar behaviors, bringing more volatility than expected.

As we have highlighted several times, the two points will shape the next trend in the Ripple market. If the bullish situation continues and the $1.00 is reached, we expect the market to bring up more resistances that will need a different event to break them all. We expect the price to follow the market trend with less intensity and deliver positive results over the long-term period.

The trading volumes made an insignificant change in the chart while the moving averages performed another bullish cross, sending a positive message for Ripple investors.

Indicators

The positive streak was continued for the MACD index, showing that the positivity rate could become stronger. The RSI index moved above value = 60, indicating that there is more uptrend in the way.

Litecoin / US Dollar

Litecoin’s performance has been less intense than ever before, as the market is moving slower than at other coins, bringing more concerns about its future. The price managed to climb to $135. This move was not characterized by any achievement on the technical side, meaning that investors should not expect anything different from this point and on.

The slow adaptation for Litecoin has been a fundamental issue, and we expect it not to be fixed in this period. This proclaims Litecoin as an underdog in the current situation, meaning that some investors would be disappointed by its performance and the results when the market is getting hotter.

The trading volumes made a small spike without any positive effect, and the moving averages delivered a “Golden Cross,” just like what happened across the market.

Indicators

MACD index passed on the positive side, taking more momentum with it in the price formation. The RSI index moved around value = 55, which indicates a steady outlook with a positive perspective for the future.

Bitcoin Cash / US Dollar

Bitcoin Cash is also moving slowly in the price chart and recovering from the recent bearish attack. As mentioned in previous articles, one of the most important points at those price levels is the $550 point. If the market manages to reach this price point, the overall situation could become more ambitious.

The return at lower levels was especially hard for Bitcoin Cash as the correction was up to 75 %, making a potential recovery more difficult than at other coins. We expect the market to try to build a recovery scenario in the next few days to follow the market trend.

The trading volumes made small progress while the moving averages made a bullish cross, indicating a positive outcome.

Indicators

MACD index moves in the “green” area day by day while the RSI index is approaching value = 60, indicating more space to be covered in the next few days.

Correlations

Bitcoin / Ethereum = 0.95 (+ 0.03), Bitcoin / Ripple = 0.89 (- 0.07), Bitcoin / Litecoin = 0.84 (- 0.11), Bitcoin / Bitcoin Cash = 0.90 (- 0.06)
Bitcoin’s pace in the bullish path has been amazing, and not all the altcoins could follow the same pace in their price development. The only coin enhanced with more boost from the current situation is Ethereum, whose correlation is increasing day by day, making the market less flexible in an unlucky event. The rest of the altcoins (Ripple, Litecoin, and Bitcoin Cash) have remained in the strong correlation zone, showing that the market integration is moving faster and faster and shapes the path for the next bullish period. We expect more action on this field to choose the winner of the next trend.