Why Bitcoin Investors Can Expect A Bull Run From This Defense Zone

Disclaimer: The findings of the following analysis are the sole opinions of the writer and should not be considered investment advice.

  • Bitcoin witnessed a modeled collapse of its long-term trend line resistance.
  • Daily active addresses saw a substantial drop, but funding rates show some improvement.

In the last seven months, Bitcoin [BTC] struggled to break above its (white, dashed) trendline resistance as it asserted a strong bearish edge. The king coin saw a relatively dull phase after an expected collapse of its bearish pattern in recent days.

Here is AMBCrypto’s Price Prediction for Bitcoin [BTC] for 2023-24

The increased selling pressure has prevented the 20 EMA (red) and the 50 EMA (cyan) from looking north. Given BTC’s recent rebound trends in the $18.4k-$18.7k range, buyers would be looking to stop the bleeding in the coming sessions.

At press time, BTC was trading at $18,431.39, down 3.53% in the last 24 hours.

After a bear flag collapse, can BTC float above its support range?

Source: TradingView, BTC/USDT

At the time of writing, BTC was struggling to revive from its multi-year support zone in the $18.4K-$18.7K range. If this range continues to hold value in buyers’ minds, the coin could see a short-term resurgence towards the Point of Control (POC, red) level in the coming sessions.

This reactivation could extend the compression phase near the high liquidity range. In this case, the first major resistance of the coin would be in the $19.3K zone. A plausible close above this barrier could pave the way for a retest of the $20.3K ceiling.

But a sustained close below the $18,400 mark could expose BTC to a test of its first major support level at the $17,600 level. Also, as BTC entered a low liquidity zone, it could witness high volatility moves in the coming times.

Additionally, the higher lows of the accumulation/distribution over the past few days marked a bullish divergence with price action.

An improved funding rate coupled with a drop in active addresses

Source: Sentiment

For a few months, BTC’s daily active directions took a sideways trajectory while historically showing a slight correlation with price action. In the last few hours, this count fell to its multi-year low as evidenced by the big drop on the chart.

But the king coin funding rate on Binance continued to post a slight uptick as it hovered above zero to show a slight bullish bias. Buyers should look for a decline in these rates to gauge the chances of a bearish pull.

Triggers and goals would remain the same as discussed. Additionally, investors/traders should take into account the macroeconomic factors that affect the general sentiment. This analysis will help them increase the chances of a profitable bet.

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