The Bitcoin market has faced a tumultuous ride, with the digital currency struggling to find stable ground amid turbulent financial currents. Recent news of potential interest rate hikes sparked a sharp selloff that sent Bitcoin plummeting below $30K, erasing its monthly gains. With the price of BTC falling by more than 8% in just a few days, sellers have been flexing their muscles. Despite these challenges, Bitcoin appears to have stabilized at its monthly support level, offering investors a glimmer of hope for a potential bullish reversal in the coming week.
Bitcoin shows a bullish sign amid the turmoil
A recent analysis of on-chain data revealed a notable increase in Bitcoin exchange outflows, which could indicate an upward trend for the price of the cryptocurrency. A CryptoQuant analyst noted that a significant amount of 2,138 BTC had been withdrawn from centralized exchanges the previous day, sparking renewed interest among market watchers.
The “exchange outflow” metric tracks the total volume of Bitcoin that is removed from the wallets associated with centralized exchanges. A strong increase in this indicator can be interpreted as a sign of bullish sentiment, as it suggests that investors are choosing to hold their assets in anticipation of a price increase rather than trading them on exchanges.
The recent spike in large withdrawals from cryptocurrency exchanges came as Bitcoin price hovered in the lower $28,000 range, a relatively low level compared to its position above $30,000 just days earlier. This phenomenon suggests that these off-exchange transfers could indicate new buying activity in the market.
A closer look at the chart also reveals that currency inflows remain low over the same period, meaning a lack of deposits to offset withdrawals. This pattern implies that, for the time being, there may be no additional interest in selling at current price levels.
Is a BTC price bounce on the horizon?
Bitcoin price stopped falling further as it found a stable support level at $27.5K. After forming a low near $27,140, Bitcoin has risen above the 23.6% Fibonacci level, suggesting that investors are piling on BTC on the dip.
At the time of writing, the BTC price is trading at $27.6K, falling more than 1.47% in the last 24 hours. If BTC price falls below $27K, it may see a decline, first to $26,400 and then potentially to the neckline of the inverse head and shoulders (H&S) pattern at $25,500.
However, a bounce to $27K is likely to be expected, and the bulls may send BTC price above the EMA-20 trend line. If Bitcoin breaks above $27,800, a bullish rally may continue towards $28,500. A successful break above the 20-EMA will again push BTC price back to its previous bullish range of $30K.
This post Bitcoin calms down near the monthly support level! Will the Bulls revive the BTC price next week?
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