BTC will enter a bull market if this level is surpassed
Bitcoin has gained around 18% over the last three days after reaching support at $20,000 on Friday. This comes on the heels of major banks collapsing and the US government quickly stepping in stating they will protect depositors in full.
According to Cointelegraph, “Silicon Valley Bank (SVB) and Signature Bank are the latest victims in a brutal year for financial institutions under the Fed’s rising interest rates — will the trend continue?
Despite Signature being crypto-focused and a major on-ramp from fiat, crypto markets have so far seen no reason to abandon optimism at the prospect of the Fed providing fresh money.”
The news of more money printing spurred spikes in Bitcoin as well as gold and silver. Taking a look at a gold chart next to a Bitcoin chart its obvious they have both been reacting the same way to the same news.
Both markets have almost identical candles for the last three trading days (albeit gold futures were closed on the weekend while Bitcoin was not).
However, Bitcoin’s explosive growth brought it to the same key resistance level it fell from a few weeks ago. So although BTC’s rally is welcomed and diverted it from falling below $20,000 it has yet to break out of its defined range of $16,000 - $25,000. Therefore it is too early to say whether or not this is a true pivot from bearish to bullish. Although it is fast approaching a resistance level that if taken out would signal exactly that.
The level that would signal that the crypto winter may be over resides currently at around $26,000. A level that Bitcoin has not traded at in 10 months. This level is represented by the all important 200-week moving average which has long been a bottoming indicator for Bitcoin. If we see Bitcoin breach the 200-week SMA then we can say that the ice is beginning to thaw and Spring is in the air.