For a while now, Bitcoin Bulls have found it difficult to get through the $4,000 mark which currently serves as the cryptocurrency’s support, due to the absence of a sufficient buying pressure to raise its price from the low range it currently is.
A popular technical indicator has suggested that a possible turning point for Bitcoin is on the way which will see to its price increment on a massive scale.
A Big Move for Bitcoin Is Imminent
According to a Bloomberg report, the GTI VERA Bands Indicator which has a widespread use has shown that soon the price of Bitcoin will move upwards. This indicator makes use of trend data to provide insight for investors as to the direction an asset is headed.
An intense narrowing has been observed in the upper and lower bands of this indicator which usually occurs before the occurrence of a significant price swing. In addition to this, the buying trend that has recently begun for Bitcoin suggests a possible buying volume increase in time to come.
Another popular indicator which goes by the name Directional Movement Index (DMI), not long ago showed a Bitcoin buy signal, which is dependent on the momentum and strength of buying and selling trends.
The DMI is used by traders to calculate the strength which a particular tend has. For several months, Bitcoin has been a no show on the DMI but all that changed earlier this week when a positive sign was displayed for Bitcoin, which means that the selling pressure of Bitcoin is steadily on the decrease while its buying volume is making a gradual increase.
The Effect of Bitcoin’s Price Action On Analysts
The efficacy of these indicators will be determined by time, then shall it be clear whether the assumed rise of Bitcoin’s price was right or wrong. Even analysts are not totally convinced about this data.
EToro’s senior market analyst, Mati Greenspan, spoke to Bloomberg about the positive flipping given to Bitcoin by DMI and said that only an increase above $5,000 would prove the Bitcoin bullish trend claim. In his words, “In technical analysis, this makes these levels very strong. But I think only once we see a strong break above 5,000, 6,000, if we get above 7,500, that’s when people start to turn really bullish.”
Ikigai’s founder, Travis Sling, is treading with caution concerning the bullish run signaled for the digital asset markets. He is of the opinion that before a bullish trend can be established, the markets will first experience more lows in time to come before climbing up.
“It’s unlikely that the bottom is in for Bitcoin. I am certainly willing to change my mind, but the preponderance of evidence leads us to believe that we’ll see more lows before we head higher.”
For the time being, traders are observing the performance of Bitcoin patiently to see if it will trade above $4,000. Until that happens, the results of these indicators will not be taken as conclusive.