Bitcoin Makes Bullish Leap Towards $27k: Target Reached?
June 20, 2023 10:22 am
The lull in the global financial markets due to the banking holiday in the U.S. led to several important conclusions. Bitcoin remains within a downward trend despite successfully consolidating above $26k. The coming days will reveal whether this price movement can be considered an attempt to reverse the trend or an upward correction.
Volatility will return to the crypto market in the coming days, and the opening of the U.S. trading session today at 11:30 UTC will serve as the initial catalyst. Over the past few days, there have been enough positive developments that could prompt BTC to make another upward leap.
BTC and SPX Correlation
Bitcoin began losing its correlation with the stock index SPX as early as May. As bearish sentiment grew in the crypto market, the interdependence of financial instruments continued to decline. The situation worsened when the S&P 500 index resumed its upward movement and reached a new price high.
The correlation between cryptocurrency and the stock index is strengthening; however, it cannot be claimed that Bitcoin will mirror the price movement of SPX. While BofA claims that the S&P 500 is heavily overbought, BTC trading volumes barely reach $10 billion. Essentially, the latest phase of the stock market’s bullish trend has exacerbated bearish sentiment in the crypto market.
The 9-week outflow of investments from crypto funds and products provides direct confirmation of this. As a result, we have witnessed liquidity and traders flowing out of the crypto market into the stock market. The SPX index reached a local high while Bitcoin found itself on the edge of a precipice, threatening the local upward trend.
Is Bitcoin more alive than dead?
Despite bearish sentiment and low trading activity, investors show increased interest in Bitcoin and other cryptocurrencies. However, unlike in April, the focus is once again shifting towards long-term storage outside of exchanges. Glassnode notes that the outflow of BTC coins to crypto exchanges has exceeded inflow.
Additionally, the percentage of BTC coins with no activity in the past three years constitutes a significant 40% of the total supply. This includes Bitcoins stored in cold wallets by long-term investors. While this approach preserves the asset’s fundamental value, it significantly hampers immediate upward movement.
BTC/USD Analysis
Despite all the ups and downs, Bitcoin managed to recover above $26k, and as of 08:00 UTC, the asset is trading near $26.8k. The cryptocurrency achieved this success thanks to a bullish impulse on June 19. Subsequently, the bulls increased the pressure and pushed the price to $27.2k, where the upper boundary of the 6-hour timeframe “bullish triangle” pattern is located.
However, sellers managed to seize the initiative, and the price dropped to the $26.8k level, where the decline halted. Based on the events of the past 24 hours, we can conclude that we witnessed an upward movement in BTC on increasing volumes. Bitcoin was able to break through the resistance zone at $26.8k, and if the asset holds above this level, it opens the way for bulls towards $27k–$27.5k.
Conclusion
The key target for the bulls at the end of the current trading day is to maintain and consolidate above the $26.8k level. If this task is successfully accomplished, Bitcoin will have a path towards $27.5k and further towards $28k. We observed a surge in trading volumes, and if this trend continues, Bitcoin has a chance to resume its upward movement with a target near $30k.
The material has been provided by InstaForex Company – www.instaforex.com
The lull in the global financial markets due to the banking holiday in the U.S. led to several important conclusions. Bitcoin remains within a downward trend despite successfully consolidating above $26k. The coming days will reveal whether this price movement can be considered an attempt to reverse the trend or an upward correction.
Volatility will return to the crypto market in the coming days, and the opening of the U.S. trading session today at 11:30 UTC will serve as the initial catalyst. Over the past few days, there have been enough positive developments that could prompt BTC to make another upward leap.
BTC and SPX Correlation
Bitcoin began losing its correlation with the stock index SPX as early as May. As bearish sentiment grew in the crypto market, the interdependence of financial instruments continued to decline. The situation worsened when the S&P 500 index resumed its upward movement and reached a new price high.
The correlation between cryptocurrency and the stock index is strengthening; however, it cannot be claimed that Bitcoin will mirror the price movement of SPX. While BofA claims that the S&P 500 is heavily overbought, BTC trading volumes barely reach $10 billion. Essentially, the latest phase of the stock market’s bullish trend has exacerbated bearish sentiment in the crypto market.
The 9-week outflow of investments from crypto funds and products provides direct confirmation of this. As a result, we have witnessed liquidity and traders flowing out of the crypto market into the stock market. The SPX index reached a local high while Bitcoin found itself on the edge of a precipice, threatening the local upward trend.
Is Bitcoin more alive than dead?
Despite bearish sentiment and low trading activity, investors show increased interest in Bitcoin and other cryptocurrencies. However, unlike in April, the focus is once again shifting towards long-term storage outside of exchanges. Glassnode notes that the outflow of BTC coins to crypto exchanges has exceeded inflow.
Additionally, the percentage of BTC coins with no activity in the past three years constitutes a significant 40% of the total supply. This includes Bitcoins stored in cold wallets by long-term investors. While this approach preserves the asset’s fundamental value, it significantly hampers immediate upward movement.
BTC/USD Analysis
Despite all the ups and downs, Bitcoin managed to recover above $26k, and as of 08:00 UTC, the asset is trading near $26.8k. The cryptocurrency achieved this success thanks to a bullish impulse on June 19. Subsequently, the bulls increased the pressure and pushed the price to $27.2k, where the upper boundary of the 6-hour timeframe “bullish triangle” pattern is located.
However, sellers managed to seize the initiative, and the price dropped to the $26.8k level, where the decline halted. Based on the events of the past 24 hours, we can conclude that we witnessed an upward movement in BTC on increasing volumes. Bitcoin was able to break through the resistance zone at $26.8k, and if the asset holds above this level, it opens the way for bulls towards $27k–$27.5k.
Conclusion
The key target for the bulls at the end of the current trading day is to maintain and consolidate above the $26.8k level. If this task is successfully accomplished, Bitcoin will have a path towards $27.5k and further towards $28k. We observed a surge in trading volumes, and if this trend continues, Bitcoin has a chance to resume its upward movement with a target near $30k.
The material has been provided by InstaForex Company – www.instaforex.com
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