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Buckle Up: Here Is Why Bitcoin Might Just Be Gearing Up For a 200% Surge

Started by Bitcoin, Jul 03, 2024, 06:53 am

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Buckle Up: Here Is Why Bitcoin Might Just Be Gearing Up For a 200% Surge

Amid the current Bitcoin market performance suggesting signs of a rebound, prominent crypto analyst Wise Advice has highlighted a critical indicator in Bitcoin’s trading pattern.

Bollinger Bands Signal 200% Bitcoin Surge

According to the analyst, the Bitcoin weekly Bollinger Band, a statistical chart characterizing the prices and volatility over time, has shrunk to its second-lowest width in six years. Traditionally, such contraction has been a precursor to substantial price movements.

Wise advice disclosed that historically, a similar constriction was observed before Bitcoin surged 200% from a base of $24,000 to a high peak within five months. This indicator is particularly noteworthy as it suggests that market volatility is about to increase, potentially leading to a significant price rise.

For context, Bollinger Bands are a set of trend indicators derived from a moving average and an upper and lower band, each set at a standard deviation from the moving average. This tool helps traders to assess how high or low the current price is relative to previous trades.

A narrowing of these bands typically indicates a reduction in volatility. A sharp increase or decrease often follows it in price, as the market prepares to make a substantial move.

Recent Market Activity and Bullish Outlook

Despite a promising setup, Bitcoin has recently struggled to maintain its upward momentum. Over the past week, while there has been a modest 3% recovery, the price has faced resistance, peaking at $63,790 before dipping to around $62,563.

Bitcoin (BTC) price chart on TradingView

This recent price action occurs amid broader market anticipation of a favorable July. Market analysts, including the team at QCP Capital, reference historical data showing Bitcoin’s tendency to rebound in July with an average return of 9.6%, especially after weak performances in June.

This pattern of a strong July following a weak June is supported by additional market commentary. They are not alone in their optimism; other market analysts like Ali have also noted similar recovery patterns in past post-June slumps, hinting at a strong comeback in July.

Supporting the bullish sentiment are the substantial inflows into US spot Bitcoin ETFs. This Monday, these funds recorded daily net inflows totaling $129.45 million, marking the fifth consecutive day of positive flows and the most substantial intake since early June.

Leading the inflows were Fidelity's FBTC and Bitwise's BITB, with significant contributions, suggesting that institutional interest remains strong despite the market’s recent fluctuations.

Featured image created with DALL-E, Chart from TradingView

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