Let’s examine the insights shared by our Technical Analyst at UseTheBitcoin as he walks us through his personal trading approach and observations on Bitcoin (BTC).
Bitcoin Market Update
June was brutal for Bitcoin. From June 1st to June 30th, the leading cryptocurrency faced relentless selling pressure, resulting in a consistent downtrend. The charts were painted red for the whole month, with Bitcoin struggling to find its footing amid a bearish market sentiment.
However, July 1st marked a significant turnaround. After several unsuccessful attempts to break above the downtrend in the preceding days, Bitcoin finally succeeded. For the first time since the downtrend began, Bitcoin traded above the critical downtrend line on July 1st and July 2nd. This development has sparked optimism among market participants, with many speculating that the bottom of the selling pressure might have been reached.
Bitcoin established support levels between $58,000 and $60,000 during its decline. Despite this positive sign, caution is still warranted. Bitcoin remains under the 20-day moving average, indicating that the bearish sentiment has not entirely dissipated. The market is still under the “shadow of the bears,” and the actual test will be whether Bitcoin can establish new support levels above its previous downtrend line.
To confirm a new bullish trend and momentum, Bitcoin needs to form and sustain support above the prior downtrend line. Achieving this would signal a shift in market dynamics, potentially leading to a more stable upward trajectory.
Analyzing Bitcoin on the weekly timeframe provides additional insights. Despite the severe correction in June, the bigger picture suggests that Bitcoin might be forming new support levels above its previous all-time high resistance levels. This recent downtrend could be seen as a “sneeze” in the market—a temporary shakeout of weaker hands orchestrated by larger players. In this context, the correction could be viewed as a necessary phase, clearing the way for stronger hands to drive the market forward.
Final Thoughts
As we move into July, the stage appears set for a potential rebound. Despite its volatility, the foundation laid in June might serve as a base for a more robust market in the coming weeks. If Bitcoin can maintain its position above the previous downtrend line and break through critical moving averages, July could indeed mark the beginning of a new and exciting chapter for Bitcoin.
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