The price of bitcoin (BTC) is once again approaching $70,000. But, if history repeats itself, there is still an upward path for the digital currency.
Bitcoin's recent rally has caught the attention of both traders and investors, but deeper analysis suggests that a sustained breakout may not be imminent. Historical trends, macroeconomic factors, and market dynamics indicate a complex outlook for Bitcoin. Here's what traders need to know
Historically, the price of bitcoin has reached the peak of a bull cycle when purchases from new entrants spike. This can be seen in the red line in the chart below, which displays BTC holdings purchased between one week and one month old.
“This is a strong entry signal from newcomers experiencing FOMO (fear of missing out),” commented the analyst known as SignalQuant. However, at the moment this is not what is being seen, which suggests even more room to rise.
Although bitcoin purchases have been boosted this year to levels not seen since the 2021 rally, it has not yet reached the highs it usually has. They have been far from what it typically has when it reaches the end of a bullish cycle, as shown by the blue line in the previous graph.