The price action of bitcoin continues to shock investors and the larger part of the crypto community in general.
In the early hours of September 27, the price of the cryptocurrency hit the $20,000 mark and is now consolidating around the $20,200 zone at the time of writing.
This price jump is a 7.5% pump from bitcoin’s daily low of $18,850. in general, recent price action on bitcoin is particularly amazing, because the conflicts of several indicators have made it hard to predict exactly what bitcoin might be doing at any point in time.
For example, while the social dominance indicator shows that bitcoin now dominates 26.2% of all topics on social platforms and may indicate bullishness, the Dow Jones index (a stock market option with observed correlation with bitcoin) has entered a technical bear market, following the 1.1% drop yesterday.
According to top crypto analysts, this recent pump is attributed to an increase in spot trading volume, with its drop to the mid $18,000 levels after news of the FED rate hike serving as fuel for a rebound.
Bitcoin So Far This Month
The price action of most cryptocurrencies including bitcoin hasn’t been favorable over the past few weeks.
After news of the FED rate hike (among other bearish factors), the price of bitcoin sank to the resistance around the $18,500 level, rendering many traders devastated and kicking many more off their running trades.
Soon after, the price of bitcoin rebounded but with weaker momentum, hovering around the $19,000 level until early this morning.
Although the price of bitcoin has shown massive movement upwards as illustrated by the chart above, the conditions on the RSI have displayed overbought conditions and may mean that it is likely we see a correction soon.
The 30-day moving average of bitcoin is also below the 200-day moving average, meaning that it is possible that this price movement continues upwards. However, taking the recent price action of bitcoin into account, some analysts are optimistic that this may just be an indication of a small-scale breakout.
According to a Tweet by top crypto analyst and influencer Michael Van De Poppe, where the crypto market is headed is unclear at the moment. However, the most likely price movement would be some consolidation before continuation, or a possible trend reversal.
Breakout on #Bitcoin above $19.3K to accelerate towards $20K, that was the gameplan yesterday and that's what we saw happening on the markets.
Not sure what will happen next, just letting PA unfold.
Wouldn't be surprised with some consolidation before continuation. pic.twitter.com/Nb8k9ui9iN
— Michaël van de Poppe (@CryptoMichNL) September 27, 2022
Poppe also expressed optimism and predicted a price movement to the $23,000 levels in his words, “for some relief” in another tweet.
Where To From Here?
As to what bitcoin might be doing at this point in terms of price, the larger part of the crypto community is divided.
Some analysts have expressed views suggesting that this recent bounce is the beginning of a possible market reversal, while others have speculated that bitcoin’s movement is nothing but a bull trap.
To support the former, it is arguably clear that inflation rises and rate hikes in the global economy are slowly weakening as the prices of energy and food are starting to peak. Meaning the same might be what is happening to bitcoin.
However, blindly jumping into the market may prove to be unwise at this point, because it is impossible to tell exactly where it is headed.
Disclaimer: The author’s comments and recommendations are solely for educational and informative purposes. They do not represent any financial or investment advice. Always DYOR (do your own research)