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Bitcoin

Bitcoin Long-Term Buy Indicator Just Flashed as BTC faces Critical Resistance (Price Analysis)

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BTC has continued to push up with impressive spot volume hitting an intraday high of $45.3k even during weekend trading.

The cryptocurrency is now testing one of the most critical levels of resistance at the 200-day moving average. Successfully reclaiming this level will trigger a significant buy signal in technicals, likely encouraging large momentum traders and other market participants to enter the market, further adding to buying pressure in an already supply exhausted state.

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Chart by TradingView

Another critical level that must be reclaimed for further upside is the 21-week moving average at $44.5K

Overall, the BTC technicals, structure, momentum, on-chain data, and sentiment have been trending higher, showing early signs of a strong recovery. One of the biggest signals of a market reversal is BTC futures open interest increasing throughout the 3-month long consolidation while funding rates were consistently negative, implying the market was net-short BTC, increasing the probability of an eventual short squeeze.

Strong spot buying, led to a massive short squeeze and pushed BTC from the lows of $28.8k to an intraday high of $45.3k

Near-Term Technicals Spell Caution

Near-term technicals appear to be overbought, with bearish divergence forming on the 4-hour chart. This suggests the BTC price could be entering a period of consolidation around current levels to prepare for the next major move.

Long-Term Buy Signal Flashing

What’s very interesting is the BTC Hash Ribbon Indicator has turned bullish on the day BTC is testing the 200-day MA. The Hash Ribbon simply measures the hash rate of the Bitcoin network over a 30-day and 60-day moving average. When the 30-day moving average crosses above the 60-day moving average, this signals potential miner capitulation – an indication that strength is returning to the Bitcoin network in hashrate.

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Chart by TradingView

The bullish cross on the BTC Hash Ribbon indicator is considered a long-term buy signal for BTC. It’s more of a lagging indicator as BTC price does not immediately rally when it flashes. The 2 previous buy signals that flashed during major recoveries in BTC hash rate, saw near-term price consolidation, then eventually a significant rally higher.

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Chart by TradingView
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Chart by TradingView

Given the near-term overbought conditions for BTC, we could see a consolidation first, before a large rally. Ideally, a near-term consolidation would be healthier for the technical structure and make the recovery more sustainable.

The weekly close for BTC is coming up at a time where the 200-day moving average is being tested with a fundamental long-term buy signal flashing. Bulls are now waiting for one of the largest technical buy signals to flash.

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Cryptocurrency charts by TradingView.

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Market & Analysis

Ethereum approaches $3K resistance as Bitcoin price rebounds toward $40K

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Ethereum’s Ether token (ETH) enjoyed a “massive” rebound towards $3,000 on Aug. 5 as optimism flowed in after its London hard fork went live.

ETH/USD 1-hour candle chart (Bitstamp). Source: TradingView

Data from Cointelegraph Markets Pro and TradingView showed ETH/USD climbing swiftly to local highs of $2,820 on Bitstamp Thursday.

The sudden burst of enthusiasm countered a downtrend which had set in after the initial uptick following London’s successful deployment the day before.

After a wick down to as low as $2,530, Ethereum outperformed many altcoins on hourly timeframes, setting its sights on resistance nearer to the $3,000 mark.

For Cointelegraph contributor Michael van de Poppe, the incoming resistance was nonetheless essential to break in order to secure bullish continuation.

“Ethereum makes a massive bounce upwards here from the critical level at $2,535,” he summarized to Twitter followers.

“However, didn’t crack and flip the resistance at $2,850-2,925 yet. That’s required to flip in order to continue toward ATH’s.”

The move came as trader and analyst Rekt Capital noted that investors were reawakening their interest in altcoin markets more broadly following last week’s significant Bitcoin (BTC) price pump.

“BTC is consolidating at highs, trying to perform an all-important retest of the top of the Weekly range it broke out from last week,” he tweeted on the day.

“Meanwhile, some of the capital that drove the $BTC move to ~$42000 last week is now flowing into some Altcoins.”

In a further triumph, ETH/BTC also looked set to reclaim important resistance at 0.07, a level in place for several weeks.

ETH/BTC 1-day candle chart (Bitstamp). Source: TradingView

Bitcoin plays catch-up

At the time of writing, ETH/USD circled $2,800, while BTC/USD was approaching $39,000 in a comeback of its own.

BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView

The largest cryptocurrency had dipped to $37,290 earlier Thursday, having previously failed to clinch $40,000 even briefly overnight.

Related: Bitcoin hits $39K highs as SEC Chair comments give BTC price 2% boost

Buyer support on major exchange Binance remained firm at $36,000 and upwards, while sellers were lined up at $41,500.

BTC/USD buy and sell levels (Binance) as of Aug. 5. Source: Material Indicators/ Twitter