Bitcoin Price Analysis: BTC/USD bulls may need some time to break $8,000
|- BTC/USD is range-bound with a mild bullish bias.
- The bulls may be discouraged by the strong resistance $8,000.
Bitcoin (BTC) hit the intraday high at $7,800 before retreating to $7,700. The first digital coin stayed unchanged since the beginning of Monday and gained nearly 1.4% on a day-to-day basis.
Over 65% of all BTC addresses are making money at the current price, which is the highest level since the beginning of March. A cluster of 1.38 million addresses contains the coins that were bought in the range from $7,900-$8,200. Once the price moves above this area, they will become profitable.
A number of large transactions nearly halved on Sunday. The figure decreased from 9.5 million to 5.9 million despite the price increase. The volume of large transactions followed the same trend and hit 389k BTC on Sunday, which is the lowest level since April 12. This trend is regarded as a bearish signal. It implies that the market is wary of the looming resistance of $8,000.
Meanwhile, according to the CEO of Luno, Marcus Swanepoel, Bitcoin is still positioned for a strong rally with the initial aim at least at $9,000.
The ability of BTC to keep above US$7,500 is good news and we think is a sign that QE money is now feeding into the sector. The problem for investors is that only a week ago analysts were suggesting that the coin could crash back to below US$6,000. The same voices are now talking about BTC being on the way to US9,000. We have always said cryptocurrencies are new assets with low trading volumes, so there will be volatility.
BTC/USD: technical picture
On a daily chart, BTC/USD retains the positive bias, though several Doji candles reflect the sense of uncertainty on the market. As the coin moves to the critical resistance $8,000, many speculative players choose to cash out. The barrier is reinforced by 61.8% Fibo retracement for the downside move from February 2020 high and daily SMA100. Once it is out of the way, the upside is likely to gain traction with the next focus on $8,750 (weekly SMA50). The last time BTC/USD traded above this MA before the mid-March collapse.
On the downside, the local support is created by $7,500. This area served as a resistance during the previous recovery attempt. Now it flipped into support. If the price moves below this line, the sell-off may be extended towards critical $7,000 with weekly SMA100 on approach. This support is likely to slow down the bears and trigger a new upside leg.
BTC/USD daily chart
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