October 6, 2022

Bitcoin (BTC) is trading below the realized price indicator which is currently at $21,400. A decisive retracement of this level would likely mark the bottom of the market.

Realized price is an on-chain indicator that measures the price of BTC at the time it last moved instead of the current price. In turn, it devalues ​​lost coins and coins that haven’t moved in a long period of time.

A well-known analyst and trader @DylanLeClair_ tweeted a chart of price and realized price, showing that the former had fallen below the latter. This means that a significant number of buyers are at a loss and is a sign associated with bear markets.

Previous history

The actual price of BTC has fallen below the achieved five times since 2011. This was in August 2011, January 2015, July 2018, March 2020 and July 2022 (black circles).

These movements are associated with the lowest values ​​of the Bitcoin market. However, the periods in which this bearish decline occurred varied.

  • 2011 – 110 days
  • 2015 – 240 days
  • 2018 – 115 days
  • 2020 – 8 days
  • 2022 – 100 days to now

Although there was no consensus on the number of days that the price of BTC remains below its realized price, it seems that when bitcoin regains its realized price, it is a sign that a bottom has been reached.

In addition, with the exception of 2011, it always took less than 100 days after the first reduction to bottom, even if this was not confirmed until BTC regained its realized price.

Current reading

The BTC price has been below the realized price for 100 days. During this time, it tried to recover the realized price and even traded slightly above it, but has since fallen back below it.

Therefore, if there are previous readings, the bottom is not confirmed, but may have been reached.

BTC movement

In terms of price action, BTC created a bearish candlestick with a long upper wick (red icon) on September 21st. The candlestick triggered a breakdown below the $19,000 support area and negated any gains coming from the September 19 bullish hammer (green icon).

So, while the daily RSI is still bullish, since its bullish divergence trendline is still intact, there is no horizontal support below the current price. On the contrary, the $19,000 area is now expected to provide resistance.

In terms of short-term movement, it is possible that BTC is trading inside a descending wedge and completing a final diagonal in the process. This is supported by a bullish divergence in the RSI and extremely volatile movement.

If true, Bitcoin would soar to $20,000 before another drop that would barely make a new yearly low.

This move would fit into the long-term calculation and complete the ongoing correction from the all-time high price (white).

For Be[In]Latest Crypto Analysis Bitcoin (BTC), click here


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