TL;DR Breakdown
- Crypto market analysts predict a Bitcoin bull run by the end of the year – How sustainable is that prediction?
- The Binance BTC/USD order book revealed a lack of bid liquidity just below $30,000.
- This week’s BTC options expiry on Friday, July 21, might cement BTC price below $30,000 for the first time since June 14-21’s 21% rise.
Description
Bitcoin is getting ready for its next bull run in typical fashion, according to traders who are keeping a watch on two important trend lines. Market analysts showed a BTC price breakthrough in the making in some of the most recent social media research. However, there is a setback. Bitcoin has failed to hold above … Read more
Bitcoin is getting ready for its next bull run in typical fashion, according to traders who are keeping a watch on two important trend lines. Market analysts showed a BTC price breakthrough in the making in some of the most recent social media research.
However, there is a setback. Bitcoin has failed to hold above $30,000 after the July 20 Wall Street Open. Some market analysts are forecasting a return to range lows.
Bitcoin traders make plans to usher in a bull market
According to a market analyst, Bitcoin is closely copying prior BTC price cycles, and the time is almost right for a bullish surge. The analyst draws attention to the 21-week simple moving average (SMA).
Once this upward-sloping trend line clears the current spot price range, a prolonged stretch of upward ensues, earning the 21-week SMA the moniker “bull market line.”
Bitcoin’s last MA cross occurred four years ago, in early 2019 — the same point in the previous cycle as the current price action. This caused that year’s local peak to approach $14,000.
In March 2020, the cross was briefly undone by the COVID-19 cross-market crash, which crypto traders refer to as a “black swan.”
The potential for a bull run: Factors at play
Several factors contribute to the potential for a Bitcoin bull run, and understanding these elements is essential in predicting market behavior.
1. Global economic conditions
Economic conditions on a global scale can significantly impact the crypto market. Investors often turn to cryptocurrencies like Bitcoin as a hedge against economic uncertainties, especially during times of inflation or geopolitical tensions.
2. Institutional adoption
The growing acceptance and adoption of Bitcoin by institutional investors have bolstered its credibility as a legitimate asset class. Major financial institutions and corporations are increasingly allocating funds to Bitcoin, creating a more stable and attractive investment landscape.
3. Halving events
Bitcoin’s protocol dictates that approximately every four years, the mining reward for each block is halved. This event, known as “halving,” reduces the supply of new Bitcoins entering the market, potentially leading to increased demand and subsequent price appreciation.
4. Technological advancements
Constant technological advancements in the crypto space lead to increased scalability, security, and accessibility, making it more appealing to both institutional and retail investors.
BTC tanks below $30,000
In other news, BTC failed to hold above $30,000 at the start of trading on Wall Street on July 20, prompting one analyst to predict a return to range lows. CoinMarketCap reports that the current Bitcoin price is $29,712.10. BTC has lost 0.83 percent over the past twenty-four hours.
On-chain monitoring gadget Material Indicators noted the significance of the 21-day SMA, suggesting that BTC/USD may have reached a temporary apex.
A previous print of the Binance BTC/USD order book revealed a lack of bid liquidity just below $30,000.
In the meantime, macroeconomic events on July 20 centered on robust tech earnings and a decline in unemployment claims in the United States.
The U.S. Dollar Index (DXY) rose to near 101 for the first time in several days, demonstrating the significant impact on the U.S. dollar.
Bitcoin options to push the coin below $30K before Friday’s expiry
This week’s BTC options expiration on Friday, July 21, could cement the $30,000 resistance level and give the bears control for the first time since the 21% rally between June 14 and June 21.
Notably, BTC’s price has consistently exhibited significant reactions following the weekly options expiration at 8:00 am UTC on Friday. Although causation cannot be established, the immensity of these price fluctuations necessitates extreme caution leading up to the July 21 weekly expiration.
In light of recent poor macroeconomic indicators, it is likely that bears will continue to suppress Bitcoin’s price until its expiration on Friday. Moreover, China’s GDP grew by 6.3% year-over-year in the second quarter, which fell short of the market expectation of 7.3% growth. Meanwhile, retail sales in the United States increased by 0.2% from the previous month, below the consensus estimate of 0.50%.
Therefore, the bulls are in a difficult position, as their call (buy) instruments will be rendered invalid if Bitcoin’s expiration price descends below $30,000. Therefore, the $35 million favorable outcome for the bears may not be a major victory, but it does enhance the likelihood of $30,000 becoming a new area of resistance.
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