Bitcoin Bulls Defend $23,000 Amid “Alive and Well” Warning Bearish Rally

Bitcoin (BTC) tested $23,000 as support during Wall Street’s August 1 open with key moving averages in focus.

BTC/USD 1 hour candle chart (Bitstamp). Source: Trading View

The 200-week moving average catches the eye

Data from Cointelegraph Markets Pro and TradingView tracked BTC/USD as bulls and bears battled for control within a tight trading range.

Bitcoin had inspired its highest weekly close since mid-June the previous day, with its monthly candle also producing the biggest gains since before last year’s all-time highs of $69,000.

Among analysts and traders, however, it was the market’s ability to stay higher for several more candles that was important.

Despite recovering important trendlines such as the 200-week moving average (MA) and realized price, Bitcoin would not be out of the woods until it started producing entire weekly candles without retesting those levels.

“The Bear Market Rally Is Still Alive”, on-chain analysis resource Material Indicators Explain day.

“To call it anything else, you need valid breakout confirmations above the key MAs. Week 200 and month 50 are the first to count for BTC, but only if we have full candles above of the line. One wick below invalid.”

BTC/USD 1 month candle chart (Bitstamp) with 50 month MA. Source: Trading View

As such, $22,880 and $21,965 were key lines to hold for the bulls and closer and closer to spot price.

Fellow trader and analyst Rekt Capital nevertheless predicted that Bitcoin would naturally attempt to retest the 200-week MA as short-term support.

Commenting on the strength of prices, however, he Noted that the 200-week MA recovery was the first such event after an “extended downtrend” since the March 2020 COVID-19 crash.

“Bitcoin may be struggling to break above the $24,000 level, but its weekly candle has finally closed above the 200-week moving average and that could improve technical sentiment significantly,” said Zain Haider. , co-founder of the Blockchain Q&A Answerly platform, abstract in the additional comment.

On-chain activity “dull at best”

With US equity markets stable that day, Bitcoin and altcoins had little macro pressure influencing price action.

Related: Best Monthly Earnings Since October 2021 – 5 Things to Know About Bitcoin This Week

The situation nonetheless remained somewhat uncertain, researchers at on-chain analytics firm Glassnode warned, with markets still reflecting the bearish mood after months of a bearish trend.

“Bitcoin and Ethereum both saw a price rebound this week, following extremely oversold conditions and fueled by risk sentiment following the July FOMC meeting,” they concluded in the latest edition of the weekly newsletter. from Glassnode, The Week on Channel.

“However, below the surface, on-chain transactional demand remains lackluster at best, and this rally has yet to see a convincing follow-through of observable demand activity.”

Glassnode added that on-chain data is still “only part of the picture”, and attention should also be paid to whether the incipient signs of change could endure.

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