Bitcoin re-tested resistance on its way up to $60,000 and was pushed back to support. At the time of writing, BTC trades at $57,500 with sideway movement in the lower and higher timeframes.
Anonymous trader IncomeSharks has set support at $53,000 with $59,000 as an initial price target which BTC managed to reach. However, selling pressure on that mark appears high with a lot of retail investors still driving the price action.
In the coming days, trader Pentoshi expects BTC’s price to gain enough momentum to break resistance to the detriment of altcoins. As the trader stated, Bitcoin’s dominance could recover in the short term, after dropping below 50%:
I think $BTC is going to break out in a big way this next week. 90 Day range PoC is confluence with all 4hr ema’s both acting as support. Last thing I want to do is be over-exposed on this move.
Analyst Willy Woo shares the same thesis and predicts a migration of capital from altcoins into BTC soon. As shown below, BTC’s dominance has entered a zone of “high probability” for a trend reversal, as Woo claimed.
Source: Willy Woo
Many investors wonder if BTC has reached a local top, as it did in January 2018 when a 3-year bear market began. However, Woo believes this cycle has different indicators with a lot of BTC switching from short-term investors to “strong holders”.
Source: BTC supply goes into strong hands
As seen above, in 2017 BTC had a parabolic run, and the number of coins held by short-term investors grew. The opposite has occurred in this bull run. As BTC’s price rises, the percentage of its supply going into long-term holders increases in an “unprecedented” fashion. Woo added:
No way are we entering a bear market. That’s obvious this week from price action, but not so obvious 2 weeks ago when the sky was falling. Coins moving to corporate treasuries likely making an impact.
Bitcoin’s Fundamental Support Bullish Sentiment
Several BTC indicators point towards price appreciation. Analyst William Clement indicated that Bitcoin’s supply held by entities with 100-1,000 BTC shows similarities with a period of consolidation during January.
At this time, the metric registered almost no oscillation until it increased. This coincided with BTC’s price gaining momentum and reaching new all-time highs. As seen below, the chart appears to be similar.
Source: Glassnode via William Clemente
During April, the derivatives market for BTC saw high variations in the funding rate across all exchange platforms. In contrast, May has been more stable more for this sector with funding rates belove 0.05% which suggests a “healthier” price action.
BTC’s May Funding Rates show stability. Source: Glassnode via William Clemente