According to Tone Vays, Bitcoin has recovered from its recent bear market low of $15,700 and is currently trading within a narrow horizontal band. The seasoned trader predicts that Bitcoin’s rise will likely take it to a significant resistance level, which could lead to the next sell-off event, though he expects a bullish continuation in the near term.

He was explaining a chart when he indicated that because the horizontal channel is forming after a 10% rise, there is a greater than 50% chance that the next breakout will be to the upside, at least because of the small size of the channel and possibly for the last bounce. greater magnitude 10% or more. There is a good chance of a further collapse to the sub-$15,000 level, based on Vays’ earlier prediction.

Source: Tone Vays/YouTube

“That brings us to the bottom of the previous channel, which is major and monster resistance, especially if it does make contact with the 128-day moving average. So I expect this bounce to probably continue through the end of the year, and then everyone will be super bullish at the start of the year, and then there’s a high probability of further capitulation to the downside.”

Bitcoin has been in capitulation since June

According to on-chain data provided by Glassnode, since June, Bitcoin and the market as a whole have capitulated, with the exception of a few rallies seen during this ongoing bear market. According to the chart below, BTC has firmly entered capitulation sentiment as on-chain net unrealized gain/loss (NUPL) data shows a decline into the red area, last seen in 2012, 2015 and 2019.

Only 54% of Bitcoin’s circulating supply most recently moved on-chain for profit, according to the Bitcoin: Percentage of Supply in Profit indicator (7-day moving average). This statistic shows that the circulating supply of BTC falls below 50% via the FTX crash, a level that has only occurred during bear market lows.

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