The price of Bitcoin has been going up this week. On October 26, it hit a new all-time high of $21,000. Because of this, a few traders have said that the market may have already hit its bottom or that Bitcoin is moving into the next phase of some kind of technical structure, such as a Wyckoff, a range break, or some kind of support resistance flip. If you’re curious about what happens to bitcoin when a bitcoin holder expires, read on.
The last update came out on September 30, 2018, and Bitcoin was worth about $19,600. This is still within the range of what the price has done in the last 136 days. At the time, I saw bullish divergences in the weekly relative strength index (RSI) and the moving average divergences (MACD). Also, several on-chain indicators were at their lowest levels in the past few years, which could be a sign that the market is “bottoming.”
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Bollinger Bands don’t have much room to move around
The daily Bollinger Bands are still close together, and this week’s jump above $21,000 was the increase in volatility that most traders had been waiting for. After breaking out of the upper arm of the channel, the price has gone back to the mid-line and mid-band to see if they can offer support (20MA). This is how things are done most of the time.
Since it bounced back from a level very close to the all-time low, which happened at 25.7, the weekly RSI has kept going up. The last analysis found a bullish divergence, which is still in place. The daily and weekly MACDs for BTC are going in the same direction.
The same chart shows that the most recent weekly candle is about to reach a higher high for the week. This shows that the asset’s price is likely to keep going up. But this will only happen if the candle closes higher than its highest point in the past five weeks.
People raise their eyebrows daily at a Bitcoin indicator called Guppy multiple moving averages. Both the short-term averages and the long-term averages are getting closer to each other. Both of these things usually mean that a change in direction is coming or that a big-picture trend is about to change.
People have discussed Bitcoin’s “record-low volatility” in the last few weeks
The price of Bitcoin has been between $18,600 and $24,500 in the last 36 days. From a technical analysis point of view, the price has been near the middle of that range. The rise above $21,000 didn’t make a big daily high and didn’t break out of the current range. It moved to the side instead. It stopped instead of going.
If the range of $29,000–$35,000 got even more comprehensive, it would give bulls looking for more evident signs of a trend reversal more confidence. Up until that point, the price had not changed at all. This is because there is resistance up to $24,800, so the price can’t go any higher.
Reserve Risk
The risk-to-reward ratio compares how attractive Bitcoin is to how risky it is to buy and hold BTC. When investors are confident, and the price of BTC is low, the risk-to-reward ratio moves into the green area.
When investors don’t trust it, and the price is high, Reserve Risk is risky. This is what will happen when there are a lot of reserves. From what we know about Bitcoin’s history, it seems like a good time to buy Bitcoin is when Reserve Risk moves into the green zone.
Taking a look ahead
Several pieces of information show that the price of Bitcoin is too low and is still trying to find a bottom. None of these things show that the market has reached its absolute bottom.
Since June, most miners with stock market shares have sold most of their Bitcoins. Recent news stories about Compute North and Core Scientific show that the price of Bitcoin is still at risk because industrial miners are having trouble making money.
Glassnode says miners might have to sell some of their reserves on the open market if they have “income stress.” The effect on Bitcoin’s price could be the next thing to start a selling spree that sends Bitcoin’s price to a new annual low.
