The last few months have been truly rough for the cryptocurrency market. This one experienced a fairly substantial bear market. It must be said that recent news, especially around the bankruptcy of FTX, a large crypto exchange, has definitely not helped. Nevertheless, positive signals have emerged over the past few days.
Among these, we can mention the considerable increase in weekly trading volume on the side of Bitcoin (BTC). By the way, although the collapse of FTX undoubtedly caused a negative fallout on the crypto market, this event also served as an impetus for the rise in BTC volume. This is reported by some professional analysts from TradingShot, a cryptocurrency analysis company.
Obvious similarities with past market cycles
As you probably know, the cryptocurrency market, like any other financial market, is made up of cycles. And if the situation turns out to be different over the cycles and the years, certain commonalities can nevertheless be noted. This is precisely what makes it possible to carry out technical analyses. In short, the past makes it possible, to a certain extent, to anticipate the future.
And what we see, about the current situation, is that it has a lot of similarities with other very favorable periods for BTC.
Thus, with regard to the formation of the bull cycle, analysts note significant similarities between the current period and that which occurred from the beginning of 2015, between January and November. During this period, we could then see a trend line of lower highs, a potential sign of a trend reversal.
A “double or quits” situation for BTC
If the situation therefore seems conducive to an increase in BTC and a reversal of the upward trend, this remains to be qualified. Indeed, such significant increases in volume are very often linked to trend reversals… in one direction or the other.
On June 13, for example, such a peak in volume could also be observed, but this did not mark the start of a rise for Bitcoin. On the contrary, it had led to a significant drop in its price.
And if we go back a little further, this bullish cycle top pattern also occurred between January 2021 and May 2021, or between December 18, 2017 and February 5, 2018.
Clearly, nothing is decided yet, as TradingShot analysts point out:
Will the November 7 volume spike mark the upward trend reversal, knocking Bitcoin out of this two-year bear cycle, or is it just a short-term rebound, at better, as was the case on June 13, 2022 or February 5, 2018?
Bitcoin price analysis
All of this doesn’t really help to shed some light on the situation, although the patterns that BTC is currently forming look interesting and have quite a few similarities to other pre-rise periods.
However, taking into account other key points, then the considerable rise of Bitcoin, which has been so awaited for months, could well take place in the near future.
First, according to crypto trading expert Michaël van de Poppe, Bitcoin is currently at a “crucial resistance” level. And if he foresees “a little more consolidation” in this area, he declared however expect a quick rise to $17.5-18,000 once this resistance is broken.
Finally, history shows that Bitcoin and the Thanksgiving holiday usually go hand in hand, with BTC tending to see a final upside as this time approaches. Note, however, that various technical analysis indicators predict a potential shortening of this trend this year.
Either way, the next few days should dictate the direction of BTC for its near future. Case to follow!
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