Bitcoin traded positively over the weekend with its price up by 3% in a week and 5% over the last 24 hours. This boost came after a week of negative news such as US Speaker Nancy Pelosi’s visit to Taiwan and its supposed effect on markets.
The price of BTC broke above a key bearish trend line with resistance near $23,300 and continued to rise above $23,500 and even $24,000. Over the last month, bitcoin has regained 12.3% and seems to be on its way to gain back its losses since it fell under $30,000.
Although this breakout does not mean for certain that bitcoin will enter a rally and reach the previous level of $30,000 anytime soon, it is still moving in the consolidation range and could continue rallying if buyers continue stepping in.
Bitcoin bounced against the lower border of the consolidation range which is around $22,550 and is on track to the upper border of the range which is around $25,690. The good news is that amidst the negativity in markets, the sentiment surrounding bitcoin remains positive. What is needed now for bitcoin to return to the level it was at in March is a spike in trading volume which would confirm that we are indeed in a reversal rally.
IntoTheBlock’s In/Out of the Money Around Price (IOMAP) model shows that bitcoin has developed a significant support floor and a rough estimate shows 1.4 million addresses purchased over 1 million BTC between $22,650 and $23,325, which could be the significant amount of interest needed for a sustained reversal rally.
If the bulls can hold the price of BTC above the $24,000 mark until the end of the week then there is a potential for it to test the $25,400 level in the next few days. Over the last months, bitcoin sentiment has been low but despite this bitcoin remained strong and sentiment is becoming more and more positive.
This could eventually result in a steady price rally that could send bitcoins price back to the $30,000 level.
