As BTC price seeks to regain $57k, Bitcoin traders are optimistic
Bitcoin (BTC) had a bad start to August, falling more than 14% on a monthly basis. This was due to a number of negative macroeconomic factors, including rising interest rates in Japan, worsening US employment data and geopolitical tensions in the Middle East.
Data from Cointelegraph Markets Pro and TradingView showed that Bitcoin lost key support at the 200-day EMA and the $50,000 level, falling to a seven-month low of $49,577 on Bitstamp.
Bitcoin's drop below $50,000 on August 5th led to massive liquidity and more than $500 billion was lost from the crypto market.
At the time of publication, Bitcoin recovered to reach $56,000 after finding support around the $54,000 zone, up 2.5% in the last 24 hours. This recovery has sparked optimism among Bitcoin analysts, who now believe that BTC has the potential to recover to higher levels.
“#Bitcoin broke the previous low and retested the January high,” Bitcoin analyst Jelle wrote on the X social media platform on August 6, “to make sure everything is OK, the price needs to go back above $57,000.”
Fellow analyst Mags shared the following chart on August 6, which shows that the Relative Strength Index (RSI) is oversold on the daily time frame.
Mags suggests that this oscillatory trend-following indicator “entered the oversold zone for the 5th time this cycle” which will trigger a recovery in BTC by buying dips and slowing down the decline supported by the weakness of sellers.
“Whenever the RSI dipped below 30, it was a good opportunity to accumulate Bitcoin.”
Mustache shared similar sentiments, stating that the RSI has sent a bearish signal on the daily chart, “presenting a buying opportunity.”
“These things usually happen in the lower region.”
Kaiko analysts confirmed this in an August 5 note on X. The recent sell-off is characterized by buying dips on US-based crypto exchanges such as Coinbase, Gemini and Kraken, as evidenced by Cumulative Volume Delta (CVD).
An increasingly positive CVD – the total difference between the bid price and the number of trades placed over a period of time – indicates that buying volume is greater than selling volume.
“While offshore exchanges such as Binance and OKX have shown strong selling since Friday, the BTC Cumulative Delta (CVD) on most US platforms has remained positive, suggesting some traders bought the dip.”
BTC's latest flash crash below $50,000 marked a 23.7% drop from the open on April 20, Bitcoin's halving day.
According to veteran trader and analyst Peter Brandt, the last post-half correction is similar to the 2015-2017 cycle. If things play out the same way, we could see a “new bull cycle high” weeks later.
The titan of crypto believes Bitcoin is on the “last cap” after experiencing a flash at the bottom of a wide wedge descending from the right angle. The chart predicts that Bitcoin will rise above $90,000.
“There is nothing surprising about this rally.”
This article does not contain investment advice or recommendations. Every investment and business activity involves risk, and readers should do their own research when making a decision.
