Bitcoin is finally moving higher after weeks of boring consolidation. In the past seven days, the asset has rallied around 4.5%. A small performance, sure, but one impressive when considering how stagnant large-cap cryptocurrency market has been over recent memory.
From a macro perspective, this recent price action may not seem to be of much importance. Yet an analyst says that the recent rally has allowed Bitcoin to accomplish a critical technical feat that could lead to more upside.
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Bitcoin Just Crossed Above a Pivotal Level
According to the head analyst at Blockfyre, a crypto research firm, the price level of the CME’s Bitcoin futures just crossed above a pivotal level:
“#Bitcoin just had it’s first daily close ever ABOVE the 3 year downtrend line from ATH’s when CME Futures launched.”
As the chart below shows, this technical level has been of macro importance. The level rejected Bitcoin at the peak of 2019’s rally at around ~$14,000, then suppressed the leading cryptocurrency over the past few months as it attempted to break higher.
Chart of Bitcoin's macro price action (BTC futures on the CME, not spot exchanges) by trader "Pentoshi" (@pentosh1 on Twitter). Chart from TradingView.com
Bitcoin completing this technical accomplishment has made the analyst who observed this extremely optimistic about BTC’s prospects:
“This is potentially an invalidation with a HH of any bearish case and the official start of a new macro bull trend.”
It’s important to note that Bitcoin’s spot market price has not yet crossed above a similar trendline. Though, the analyst who shared the chart above wrote that BTC could “teleport” above that level as pressure continues to build under the asset.
The recent rally in the crypto market is also bullish for BTC across a shorter time frame. One trader commented that the rally to $9,600 allowed the asset to break a bearish market structure that was set to send Bitcoin plummeting:
“Multiple failed attempts to send price lower soaked up at daily demand & the monthly open for BTC. Yesterday’s 1D close posted a higher high breaking MS on the daily. Metals, equities, alts, all ripping higher… may be time for the best asset of the past decade to now,” the trader said in reference to the chart below.
Chart of BTC breaking a local bearish market structure by crypto trader “HornHairs” (@Cryptohornhairs on Twitter). Chart from TradingView.com
On-Chain Data Shows Bulls Are in Control
On-chain indicators also suggest BTC bulls are currently in control of price action.
Ki Young Ju, the chief executive of Crypto Quant, recently shared a confluence of on-chain metrics signaling a “BUY.” These include low Bitcoin miner outflows, low outflows from BTC whales, and a low number of coins held by exchanges.
On-chain Indicators Status: BUY
– Miners are not selling (based on MPI, Miner Outflows)
– No significant #BTC exchange inflows from whales so far
– All exchanges' reserve hit the year-low a month ago and keep that low pic.twitter.com/IzEmujvbsU
— Ki Young Ju (@ki_young_ju) July 20, 2020
Featured Image from Shutterstock Price tags: xbtusd, btcusd, btcusdt Charts from TradingView.com BTC Just Closed Above a 3-Year Trendline Formed At 2017's $20k High