Wednesday 17 August 2022
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Bitcoin price holds $23.5K, leading bulls to say ‘it’s different this time’

Similar to Stockholm syndrome where captives develop a psychological bond with their captors, crypto winters have a way of flipping even the most bullish cryptocurrency supporters bearish in a short period of time.

Evidence of this reality was on full display on July 19 after the recovery of Bitcoin (BTC) back above $23,000 was met with widespread warnings that the move was merely a fakeout before the market heads for new lows

While the possibility of new lows being set in the future can’t be ruled out, here’s a look at analysts' opinions on how this BTC breakout could be different than most investors expect.

This time "it's different"

The pointed message of “this time is different” was offered by pseudonymous Twitter user Trader XM, who posted the following chart outlining why BTC is poised to head higher.

BTC/USD 4-hour chart. Source: Twitter

As highlighted on the chart above, BTC price did not retest of the range low even as four retests of the range high took place, and this suggests that buyers are now stronger than sellers.

In response to the post from Trader XM, Twitter user Justiinape replied “$27K-$28K seems imminent.”

Trader XM said,

“Agree my man, move to $27-28K then months of consolidation. Let's enjoy this move before the long hibernation.”

The next major resistance is at $27,100

Further evidence that BTC could head higher was supplied by the on-chain data firm Whalemap, which posted the following chart highlighting the lack of buying demand between $23,000 and $27,000.

Bitcoin volume profile. Source: Twitter

Whalemap said,

“$27,100 should be the first resistance on our way up. Big gap in supply between current prices and $27K.”

Related: Bitcoin price moves toward $24K and traders expect further upside, after a support retest

Shorts get REKT

Proof that crypto traders had been lulled into an overly bearish outlook was provided by cryptocurrency analyst Dylan LeClair, who posted the following chart showing the effect that Bitcoin’s move above $23,000 had on the futures traders.

BTC/USD 2-hour chart. Source: Twitter

As highlighted on the chart, there was a large amount of Bitcoin short positions opened between June 15 and July 15 and these traders now find themselves on the losing side of the trade.

LeClair said,

“Tens of thousands worth of BTC short open interest currently underwater.”

While Bitcoin reversing course and heading lower once again remains a possibility, the current momentum suggests further upside in the short term.

The overall cryptocurrency market cap now stands at $1.055 trillion and Bitcoin’s dominance rate is 42.1%.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

About Sean Patterson

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