Sunday, December 4, 2022

The Level To Beat For Bitcoin To Register Another Bull Rally

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Bitcoin remains on a positive recovery trend. One that could very well see it beat the coveted $45,000 resistance point. This price level remains the level to beat for the digital asset as this is where bears continue to mount the most resistance. Bitcoin had tested this level in the early hours of Friday but like always, met significant push that caused it to crash back down below it.

In the wake of this crash, the market saw bitcoin lose almost $1,000 in the space of two hours. However, this dip would be defined by a higher low as bitcoin had been able to find support above $44,000 and continue on its recovery. This demonstration at $45,000 shows that until the digital asset can successfully beat and settle above this level, it can never truly be said to have begun another bull run.

Related Reading | Quant Explains How Stablecoin Ratio Can Give Bitcoin Buy Or Sell Signals

The market is now turning favorable for buyers although sellers still maintain a majority hold on the market. If bitcoin is to beat $45,000 and register on another bull run, then buyers would have to turn up their support. Otherwise, bitcoin will continue to fail in its quest to beat this level. Thus leaving the market in what is threatening to be another long stretch of bear market.

In the short term, the indicators are turning bullish in favor of bitcoin. This comes after the digital asset cemented its position above the 50-day simple moving average, an important milestone for an asset looking to break out of a bear trend. This has successfully moved sentiment out of fear in regards to the asset and buying pressures are on the rise.

But Why $45,000 For Bitcoin?

The $45,000 level is important for bitcoin due to its trading trends in the last few months. Since the December crash, the digital asset has traded between the $36,000 and $44,000 level, never once successfully breaking above $45,000. This shows that this is where bears are taking their stand and a breach of this point would mean another resettlement into the bull territory.

In the same vein, $36,000 remains the point to beat for bears. As was witnessed the last four times bitcoin had broken above $40,000 and trended downwards again, significant support showed between $36,000-$38,000. A break below this point would be good news for bears as it would very well put the digital asset on a path down below $30,000.

Bitcoin price chart from TradingView.com

BTC seeing significant support around the $36k-$38k level | Source: BTCUSD on TradingView.com

Both these points have now become important make or break points for both camps, leading to a serious tug of war between the two.

Related Reading | Bitcoin Miner Revenue Grows By 7%. Here’s How Much They Made

Bitcoin is trading above $44,000 at the time of this writing. Indicators point towards another test of the $45,000 level but only if the asset can pick up enough buying momentum to recover above $44,600.

Featured image from BBC, chart from TradingView.com

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