The recent rise in the price of bitcoin (btc) has sparked renewed interest and confidence among investors, leading many to believe that the btc bull run is accelerating..
According According to crypto trader and analyst Adrian Zduńczyk, bitcoin has reached a new 52-week closing high and has maintained a close above the previous high of $32,000 for three consecutive weeks.
This sustained bullish momentum indicates strong bullish sentiment and signals the beginning of the third wave of the bitcoin bull market.
Analyst highlights key trends
Zduńczyk points out several dominant trends that contribute to the positive outlook for bitcoin. The rising 200-week and 50-week moving averages (MA) highlight the strength of the long-term uptrend, with key support levels at $28,800 and $26,600.
Additionally, there is an increasing correlation with the S&P 500, as evidenced by the 7-week correlation coefficient of 0.34. This alignment with traditional markets suggests that bitcoin is becoming increasingly traded. similar to Nasdaq.
Fundamental drivers also play an important role in bitcoin‘s upward trajectory. Traders Eagerly Await bitcoin Spot Approval exchange traded funds (ETF) and the upcoming fourth halving event.
Furthermore, according to Zduńczyk, the historical pattern of previous halvings indicates that bitcoin has recovered significantly after each half and has never returned to pre-halving prices.
Examining the daily trend, Zduńczyk highlights the technical strength demonstrated by bitcoin‘s reliable breakout above $32,000. Breakouts often lead to the formation of new trends that persist over time.
Despite occasional volatility, the 50-day Average True Range (ATR) trend and the 50-day Relative Strength Index (RSI) momentum trend are rising, indicating continued positive momentum.
The future of bitcoin looks bright, supported by positive market trends, fundamental drivers, and technical indicators. However, warning signs cast doubt on bitcoin‘s favorable prospects. as Renowned crypto analyst Ali Martinez he pointed.
Is bitcoin‘s bullish momentum at risk?
Martínez draws attention to the bearish divergence between bitcoin price and network growth, indicating a possible lack of sustained momentum in the current uptrend.
The chart above shows a notable disparity between the exponential rise in bitcoin price and the dramatic decline in new addresses over the past few days.
This bearish divergence raises concerns about the overall strength of the current bullish trend. While the value of bitcoin has seen significant gains, the number of new addresses created has decreased significantly.
According to Martínez, this bearish divergence between bitcoin price and network growth serves as an on-chain sell signal that traders should take into account. The slowdown in network growth despite rising prices suggests that the current bullish momentum may not have enough strength to sustain itself.
At the time of writing, btc is trading at $36,200, down 1.6% in the last 24 hours. However, it is still up a substantial 4.6% in the last 7 days.
It remains to be seen whether a surge in new directions will be able to support btc‘s bullish momentum and break the current consolidation phase. Alternatively, the cryptocurrency could retest support levels in the coming days.
Featured image from Shutterstock, chart from TradingView.com
