Bitcoin Price

Falling wedge pattern points to eventual Ethereum price reversal, but traders expect more pain first

ETH dropped below a key support in its USD/BTC pair, but analysts say a bullish trading pattern could eventually spark a sharp trend reversal.

The cryptocurrency market was hit with another round of selling on May 26 as Bitcoin (BTC) price dropped to $28,000 and Ether (ETH) briefly fell under $1,800. The ETH/BTC pair also dropped below what traders deem to be an important ascending trendline, a move that traders say could result in Ether price correcting to new lows.

ETH/USDT 1-day chart. Source: TradingView

Here’s a rundown of what several analysts in the market are saying about the move lower for Ethereum and what it could mean for its price in the near term.

Price consolidation will eventually result in a sharp move

A brief check-in on what levels of support and resistance to keep an eye on was provided by independent market analyst Michaël van de Poppe, who posted the following chart showing Ether trading near its range low.

ETH/USD 1-hour chart. Source: Twitter

Van de Poppe said:

“The question will be whether we can bounce from here and break the $1,940 level. If that happens, I’m assuming we’ll continue $2,050. If it doesn’t, then the markets are looking at

ETH could make new lows into a bullish falling wedge

According to Twitter analyst Crypto Tony, Ether price is “still looking for that leg down to load up on.”

ETH/USDT 4-hour chart. Source: Twitter

While it might look negative, this development is actually a positive sign, according to Cointelegraph contributor Jon Morgan, who noted that the pattern outlined on this chart is a falling wedge, a “bullish standard candlestick/bar chart pattern that is indicative of a market that has moved to an extreme and is likely to reverse.”

Morgan said:

“Very high expectancy rate of creating either a violent corrective move higher or an entirely new uptrend.”

Related: Ethereum price dips below the $1.8K support as bears prepare for Friday’s $1B options expiry

Bitcoin dominance rises

ETH/BTC 1-day chart. Source: Twitter

According to economist Caleb Franzen, the ETH/BTC pair lost a key support and this is notable because:

“This means that at least one of these statements will be true: $ETH is weakening relative to $BTC; $BTC will outperform $ETH; Alts will underperform $BTC.”

Adding to the ETH/BTC discussion, Twitter user CrediBULL Crypto noted that the price is “starting to take some of our local lows.”

ETH/BTC 3-day chart. Source: Twitter

The analyst said:

“Any relief here is temporary until we traverse to the bottom of this range, imo. In fact, we may head even lower than pictured here before staging a recovery, but will assess once we hit my target.”

In general, continued weakness with the ETH/BTC pair has the potential to result in the price of Ether and altcoins trending lower while BTC could hold at its current price or even head higher as traders rotate out of underperforming positions into Bitcoin.

The overall cryptocurrency market cap now stands at $1.235 trillion and Bitcoin’s dominance rate is 46.2%.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

‘Extreme fear’ grips Bitcoin price, but analysts point to signs of a potential reversal

Sideways crypto price action persists as the Federal Reserve confirms its plan to continue raising interest rates, but analysts spot a silver lining.

The cryptocurrency market settled into a holding pattern on May 25 after traders opted to sit on the sidelines ahead of the midday Federal Open Market Committee (FOMC) meeting, where the Federal Reserve signaled that it intends to continue on its path of raising interest rates. According to data from Alternative.me, the Fear and Greed Index is seeing its longest run of extreme fear since the market crash in Mach 2020.

Crypto Fear & Greed Index. Source: Alternative

Data from Cointelegraph Markets Pro and TradingView shows that the price action for Bitcoin (BTC) has continued to compress into an increasingly narrow trading range, but technical analysis indicators are not providing much insight on what direction a possible breakout could take.

BTC/USDT 1-day chart. Source: TradingView

Here’s a look at what analysts think could come next for Bitcoin price.

Whales accumulate as Bitcoin battles to reclaim $30,000

BTC/USDT 15-minute chart. Source: Twitter

According to market analyst Michaël van de Poppe, “#Bitcoin broke through $29.4K and ran towards the next resistance zone. If we hold $29.4K, we’ll be good towards $32.8K. Finally.”

One interesting thing to note at these price levels is that while the predominant sentiment is that of extreme fear, on-chain intelligence firm Santiment pointed out that whale wallets have taken this as an opportunity to accumulate some well-priced BTC.

Bitcoin price vs. supply distribution. Source: Santiment

Santiment said:

“As #Bitcoin continues treading water at $29.6K, the amount of key whale addresses (holding 100 to 1k $BTC) continues rising after the massive dumping from late January. We’ve historically seen a correlation between price & this tier’s address quantity.”

Price could still pull back to $22,500

A macro perspective on how Bitcoin performs following the appearance of a death cross was offered by pseudonymous Twitter user Rekt Capital, who posted the following chart outlining what to expect if the “historical price tendencies relating to the #BTC Death Cross repeat […]”

BTC/USD 1-week chart. Source: Twitter

Rekt Capital said:

“$BTC will breakdown from the Macro Range Low support & continue its drop to complete -43% downside. The -43% mark is confluent with the 200-Week MA at ~$22500.”

Related: Scott Minerd says Bitcoin price will drop to $8K, but technical analysis says otherwise

“A pivotal retest”

The importance of the current price level for Bitcoin was touched upon by economist Caleb Franzen, who posted the following chart looking at the long-term performance of BTC versus its weekly anchored volume-weighted average price (AVWAP), noting that “This is a pivotal retest, similar to the dynamics in March 2022.”

BTC/USD vs AVWAP 1-week chart. Source: Twitter

Franzen said:

“A rebound on the weekly AVWAP from the COVID low could increase bullish probabilities. A breakdown below it would drastically increase bearish probabilities, foreshadowing a retest of the grey range, $13.8k-19.8k.”

The overall cryptocurrency market cap now stands at $1.265 trillion and Bitcoin’s dominance rate is 44.8%.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Scott Minerd says Bitcoin price will drop to $8K, but technical analysis says otherwise

BTC price could be poised for a big bounce despite Minerd’s prediction that price will drop to $8,000.

Bitcoin (BTC) is predicted to drop more than 70% to the $8,000 value area, according to comments by Guggenheim chief investment officer Scott Minerd. This is not the first time he has made a bearish call, and he has, in the past, made bullish calls as well. However, Minerd’s more recent calls have occurred just before major reversals.

It should be noted that Mr. Minerd, if inferred from previous comments, is a Bitcoin bull and has a long forecast for the biggest digital asset in the six-figure range. However, if traders and investors used his comments as a sentiment indicator for a market low, then other confirmatory data must be used.

Long term oscillators values support a bullish reversal

The weekly and monthly RSI (relative strength index) and composite index show that extremes have been met. These extremes do not predict or guarantee a reversal. Still, they warn bears that the momentum of further downside movement is likely to be severely limited or eliminated.

BTC/USD weekly relative strength index (RSI) (Coinbase) Source: TradingView

The weekly RSI remains in bull market conditions, despite it moving below both the oversold levels of 50 and 40 — until it hits 30, the bull market RSI settings remain. Currently, at 33, this weekly RSI level is the lowest since the week of December 10, 2018, and just below the March 2020 COVID-19 crash low of 33.48.

Likewise, the weekly composite index reading for Bitcoin is at an extreme. It is currently at the lowest level it has traded at since the week of February 8, 2018. The current level that the weekly composite index is at has historically been a strong indicator that a swing low is likely to develop.

BTC/USD weekly composite index (Coinbase) Source: TradingView

The black vertical lines identify the most recent historical lows in Bitcoin’s weekly composite index.

Chart patterns on oscillators can help identify upcoming reversals

The use of basic chart patterns like rectangles and triangles on a Japanese candlestick or American bar charts c is not limited to just the price chart. For example, the great analyst and trader Connie Brown (the creator of the composite index) impresses analysts and traders to pay attention to chart patterns in oscillators.

BTC/USD monthly (RSI) (Coinbase) Source: TradingView

The falling wedge pattern on the monthly RSI fulfills all the requirements to confirm that pattern: five touches of the trend lines. It should be noted that the monthly RSI for Bitcoin, like the weekly RSI, remains in bull market conditions, and the current RSI is just below the first oversold level of 50.

Another major development with Bitcon’s oscillators is the regular bullish divergence between the monthly RSI and the monthly composite index. The composite index, created by Connie Brown, essentially is the RSI with a momentum calculation — it catches moves that the RSI cannot.

Note the structure of the lines on the monthly RSI compared to the composite index. The RSI shows lower lows, but the composite index shows higher lows. That is a regular bullish divergence.

BTC/USD Monthly composite index (Coinbase) Source: TradingView

Regular bullish divergence is most often measured between price and an oscillator, but it can also be measured between two oscillators. Regular bullish divergence is a warning sign that the current downtrend will likely face a corrective move higher or the beginning of a new uptrend.

Bitcoin price action remains correlated to stocks

Due to the continued correlative behavior between Bitcoin and the broader cryptocurrency market to stocks, special attention should be given to this week, specifically Thursday (May 26, 2022).

Economists and Wall Street continued to sound off worries about growth. After Target’s (NYSE: TGT) dismal quarterly report last week, all eyes are on other big-name retailers announcing earnings on May 26: Macy’s (NYSE: M), Dollar Tree (NASDAQ: DLTR) and Dollar General (NYSE: DG) are all on deck May 26.

However, given that much of the stock market is below bear market levels, any negative news from retail stocks or the United States Federal Reserve is likely to be considered “priced in.” Volume into the tech-heavy NASDAQ (NASDAQ: QQQ) has increased, as have inflows to Bitcoin and the wider crypto market.

Thus, if stocks bounce, Bitcoin will bounce. The upside potential for Bitcoin will likely be limited to the critical psychological and 2022 volume point of control at $40,000.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Low inflation or bust: Analysts say the Fed has no choice but to continue raising rates

The Federal Reserve’s steady interest rate hikes have put stocks and crypto into bear market territory, but analysts worry about what happens if inflation still remains out of the “target range.”

As economic conditions continue to worsen, financial experts worldwide are increasingly placing the blame at the feet of the United States Federal Reserve after the central bank was slow to respond to rising inflation early on.

Financial markets are currently experiencing their worst stretch of losses in recent history, and it doesn’t appear that there is any relief in sight. May 24 saw the tech-heavy Nasdaq fall another 2%, while Snap, a popular social media company, shed 43.1% of its market cap in trading on May 23. 

Much of the recent turmoil again comes back to the Fed, which has embarked on a mission to raise interest rates in an attempt to get inflation under control, financial markets be damned. 

Here’s what several analysts are saying about how this process could play out and what it means for the price of Bitcoin (BTC) moving forward. 

Will the Fed tighten until the markets break?

Unfortunately for investors looking for short-term relief, economist Alex Krüger thinks that “The Fed will not stop tightening unless markets break (far from that) or inflation drops considerably and for *many* months.”

One of the main issues affecting the psyche of traders is the fact that the Fed has yet to outline what inflation would need to look like for them to take their foot off the rate-hike gas pedal. Instead, it simply reiterates its goal “’to see clear and convincing evidence inflation is coming down’ towards its 2% target.”

According to Krüger, the Fed will “need to see Y/Y [year-over-year] inflation drop 0.25%–0.33% on average every month until September” to meet its goal of bringing down inflation to the 4.3%–3.7% range by the end of the year.

Should the Fed fail to meet its PCE inflation target by September, Krüger warned about the possibility that the Fed could initiate “more hikes *than what’s priced in*” and also begin exploring the sale of mortgage-backed securities as part of a quantitative tightening campaign.

Krüger said:

“Then markets would start shifting to a new equilibrium and dump hard.”

A setup for double-digit sustained inflation

The Fed’s responsibility for the current market conditions was also touched on by billionaire investor and hedge fund manager Bill Ackman, who suggested that “The only way to stop today’s raging inflation is with aggressive monetary tightening or with a collapse in the economy.”

In Ackman’s opinion, the Fed’s slow response to inflation has significantly damaged its reputation, while its current policy and guidance “are setting us up for double-digit sustained inflation that can only be forestalled by a market collapse or a massive increase in rates.”

Due to these factors, demand for exposure to stocks has been muted in 2022 — a fact evidenced by the recent decline in stock prices, especially in the tech sector. For example, the tech-heavy Nasdaq index is now down 26% on the year. 

With the cryptocurrency sector being highly tech-focused, it’s not surprising that weakness in the tech sector has translated to weakness in the crypto market, a trend that could persist until there is some form of resolution to high inflation.

Related: Bitcoin price returns to weekly lows under $29K as Nasdaq leads fresh US stocks dive

How could Bitcoin fare going into 2023?

According to Krüger, the “base case scenario for upcoming price trajectory is a summer range that starts with a rally followed by a drop back to the lows.”

BTC/USDT 1-day chart. Source: Twitter

Kruger said:

“For $BTC, that rally would take price to the start of the Luna dump (34k to 35.5k).”

Crypto trader and pseudonymous Twitter user Rekt Capital offered further insight into the price levels to keep an eye on for a good entry point moving forward, posting the following chart showing Bitcoin relative to its 200-day moving average.

BTC/USD 1-week chart. Source: Rekt Capital

Rekt Capital said:

“Historically, #BTC tends to bottom at or below the 200-MA (orange). The 200-MA thus tends to offer opportunities with outsized ROI for $BTC investors (green). […] Should BTC indeed reach the 200-MA support… It would be wise to pay attention .”

The overall cryptocurrency market capitalization now stands at $1.258 trillion, and Bitcoin’s dominance rate is 44.5%.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Crypto funds under management drop to a low not seen since July 2021

Outflows from digital asset funds reached $141 million last week, a figure not seen since July 2021.

Digital asset investment products saw $141 million in outflows during the week ending on May 20, a move that reduced the total assets under management (AUM) by institutional funds down to $38 billion, the lowest level since July 2021. 

According to the latest edition of CoinShare’s weekly Digital Asset Fund Flows report, Bitcoin (BTC) was the primary focus of outflows after experiencing a decline of $154 million for the week. The removal of funds coincided with a choppy week of trading that saw the price of BTC oscillate between $28,600 and $31,430.

BTC/USDT 1-day chart. Source: TradingView

Despite the sizable outflow, the month-to-date BTC flow for May remain positive at $187.1 million, while the year-to-date figure stands at $307 million.

On a more positive note, the multi-asset category of investment products managed to record a total of $9.7 million worth of inflows last week. This brings the yearly total inflow into these products to $185 million, representing 5.3% of the total AUM.

CoinShares pointed to the uptick in volatility as a possible source for the increased inflows into multi-asset investment products, which can be seen as “safer relative to single line investment products during volatile periods.” So far in 2020, these investment products have only experienced two weeks of outflows.

Cardano (ADA) and Polkadot (DOT) led the altcoin inflows with increases of $1 million each, followed by $700,000 worth of inflows into Ripple (XRP) and $500,000 into Solana (SOL).

Flows by asset during the week ending May 20, 2022. Source: CoinShares

Out of all the assets covered, Ethereum (ETH) has seen the worst performance so far this year with $44 million worth of outflows in the month of May bringing its year-to-date figure to $239 million.

Related: Bitcoin’s current setup creates an interesting risk-reward situation for bulls

Strengthening dollar continues to impact crypto market sentiment

The declining interest in digital asset investment products comes amid the backdrop of a strengthening dollar, which has been “one of the most important macro factors driving asset prices over the last six months,” according to cryptocurrency market intelligence firm Delphi Digital.

U.S. dollar currency index. 1-week chart. Source: Delphi Digital

As shown on the chart above, the Dollar Index (DXY) has risen from 95 at the start of 2022 to 102 on May 23, a year-to-date gain of 6.8%. This marks the fastest year-over-year change for the DXY in recent history and led to a breakout from the range it had been stuck in for the past seven-years.

Delphi Digital said,

“This DXY strength has been a consistent drag to risk asset performances over this same time period.”

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

WEF 2022: Bitcoin should be seen from an innovation perspective, says Miami mayor

Francis Suarez reminded people that volatility plays an equal role when the market is going up, but the concerns only come up during bear markets.

Miami mayor Francis Suarez believes that Bitcoin (BTC) should be seen from an innovation perspective rather than just as an investment asset.

Suarez’s comments came during his discussion on “The Future of Crypto” on the third day of the ongoing World Economic Forum (WEF) 2022 at Davos. He said:

“We live in a world where investors only look at things from a return perspective, but Bitcoin should be seen from an innovative and technology perspective.”

When asked about his views on the volatility debate in the crypto market, Suarez said that the phenomenon is a part of the crypto ecosystem and has been common among evolving and nascent tech. 

He reminded people that although the volatility debate seems to be prevalent only during a bear market, it plays a key role when the market is going up as well.

He also claimed that the Bitcoin price would become stable over time when it would shift from being an asset class to a form of “currency.” He explained:

“I will talk from the Bitcoin perspective since it’s the original cryptocurrency. Currently, it is behaving like an asset class, but over time it would move towards being a currency. Once its currency aspect takes center stage, I think the price will stabilize as well.”

When enquired about the reason behind his support for BTC, Suarez said:

“Who can we trust today? Politicians? The bankers or policymakers? This is where the likes of Bitcoin are making a mark, even though invented by a human it has been designed to follow a set of codes that cannot be altered.”

Suarez was joined by Crypto Council for Innovation CEO Sheila Warren, who agreed with the Miami mayor on the Bitcoin debate and said “[Bitcoin] has proved its mettle by sustaining through several price cycles and its current price speaks volumes of its cycle.”

20% drop in the S&P 500 puts stocks in a bear market, Bitcoin and altcoins follow

Recession fears mount as a 20% decline in the S&P 500 places stock in a bear market, increasing the chance that BTC and altcoins will make new lows.

Whoever coined the phrase “sell in May and go away” had brilliant insight, and the performance of crypto and stock markets over the past three weeks has shown that the expression still rings true.

May 20 has seen a pan selloff across all asset classes, leaving traders with few options to escape the carnage as inflation concerns and rising interest rates continue to dominate the headlines.

Data from Cointelegraph Markets Pro and TradingView shows that the price of Bitcoin (BTC) taking on water below $29,000, and traders worry that losing this level will ensure a visit to the low $20,000s over the coming week.

BTC/USDT 1-day chart. Source: TradingView

As reported by Cointelegraph, some analysts warn that BTC could possibly decline to $22,700 based on its historical price performance following a death cross.

Further evidence of muted expectations from traders can be found in the put/call ratio for BTC open interest, which hit a 12-month high of 0.72 on May 18, according to the cryptocurrency research firm Delphi Digital.

Bitcoin put/call ratio on open interest and volume. Source: Delphi Digital

Delphi Digital said:

“A high put/call ratio indicates that investors are speculating whether Bitcoin will continue to sell off, or it could mean investors are hedging their portfolios against a downward move.”

Stocks enter bear market territory

May 20 brought more pain to the traditional markets as the S&P 500 fell another 1.62%, marking a more than 20% decline from its January 2022 all-time high and further stoking recession fears. If the index manages to close the day down 20% from the all-time-high, that would officially put the benchmark index in bear market territory.

Performance of the major indices on May 20. Source: Yahoo Finance

The Nasdaq Composite and Dow have also seen significant losses amid the widespread weakness, with the Nasdaq losing 275 points for a 2.42% loss, while the Dow has fallen 362 points, marking a decline of 1.28%.

Related: Crypto veterans extend a helping hand to bear market newbies

What’s bad for BTC is even worse for altcoins

Daily cryptocurrency market performance. Source: Coin360

Altcoins also sold off sharply as BTC, Ether (ETH) and stocks pulled back, reversing the gains seen earlier on the day. 

The few bright spots were Ellipsis (EPS), Persistence (XPRT) and 0x (ZRX), which gained 30%, 13.92% and 12.34%, respectively.

The overall cryptocurrency market cap now stands at $1.234 trillion and Bitcoin’s dominance rate is 44.6%.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Contrarian Bitcoin investors identify buy zones even as extreme fear grips the market

A popular BTC price metric points to “extreme fear” in the market, but contrarian investors say multiple on-chain metrics suggest Bitcoin is in buy territory.

Bitcoin (BTC) support at the $30,000 level has proven to be quite resilient amid the turmoil of the past two weeks, with many tokens in the top 100 now showing signs of consolidation after prices bounced off their recent lows.

Fear & Greed Index. Source: Alternative.me

During high volatility and sell-offs, it’s difficult to take a contrarian view, and traders might consider putting some distance from all the noise and negative news flow to focus on their core convictions and reason for originally investing in Bitcoin.

Several data points suggest that Bitcoin could be approaching a bottom which is expected to be followed by a lengthy period of consolidation. Let’s take a look at what experts are saying.

BTC may have already reached “max pain”

The spike in realized losses by Bitcoin holders was touched on by Root, a pseudonymous analyst, who tweeted the following chart and said realized losses are “reaching bear market highs.”

Bitcoin realized profit/loss. Source: Twitter

While previous bear markets have seen a greater level of realized losses than are currently present, they also suggest that the pain could soon begin to subside, which would allow Bitcoin to begin the slow path to recovery.

Analysts have also pointed out that “Bitcoin’s RSI is now entering a period that has historically preceded outsized returns on investment for long-term investors.”

BTC/USD RSI. Source: Twitter

According to Rekt Capital:

“Previous reversals from this area include January 2015, December 2018, and March 2020. All bear market bottoms.”

Strong hands hold firm

Additional on-chain evidence that Bitcoin may soon see a revival was provided by Jurrien Timmer, Global Director of Macro at Fidelity. According to the Bitcoin Dormancy Flow, a metric that displays the dormancy flow for Bitcoin that “roughly speaking is a measure of strong vs. weak hands.”

Bitcoin dormancy flow. Source: Twitter

Timmer said:

“The entity-adjusted dormancy flow from Glassnode is now at the lowest level since the 2014 and 2018 lows.”

One metric that suggests that the weak hands may be nearing capitulation is the Advanced NVT signal, which looks at the Network Value to Transactions Ratio (NVT) and includes standard deviation (SD) bands to identify when Bitcoin is overbought or oversold.

Advanced NVT signal. Source: LookIntoBitcoin

As shown on the chart above, the advanced NVT signal, which is highlighted in light blue, is now more than 1.2 standard deviations below the mean, suggesting that Bitcoin is currently oversold.

Previous instances of the NVT signal falling below the -1.2 SD level have been followed by increases in the price of BTC, although it can sometimes take several months to manifest.

Related: Bitcoin price predictions abound as traders focus on the next BTC halving cycle

Hash rate hits a new all-time high

Aside from complex on-chain metrics, there are several other factors that suggest Bitcoin could see a boost in momentum in the near future.

Data from Glassnode shows that the hashrate for the Bitcoin network is now at an all-time high, indicating that there has been a substantial increase in investments in mining infrastructure with the most growth happening in the United States.

Bitcoin mean hash rate vs. BTC price. Source: Glassnode

Based on the chart above, the price of BTC has historically trended higher alongside increases in the mean hash rate, suggesting that BTC could soon embark on an uptrend.

One final bit of hope can be found looking at the Google Trends data for Bitcoin, which notes a spike in search interest following the recent market downturn.

Interest in searching for Bitcoin over time. Source: Google Trends

Previous spikes in Google search interest have largely coincided with an increase in the price of Bitcoin, so it’s possible that BTC could at least see a relief bounce in the near future if sidelined investors see this as an opportunity to scoop up some Satoshis at a discount.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Bitcoin price predictions abound as traders focus on the next BTC halving cycle

Traders still anticipate BTC prices above $100,000, but a closer look at the BTC halving cycle chart suggests that a sharper downside move will occur first.

Terra’s (LUNA) recent collapse has been repeatedly singled out as the main source of weakness affecting crypto assets. Still, it’s much more likely that a combination of factors is behind the start of this current bear market.

At the same time that the market was reeling from the Terra saga, the two-year mark for the next Bitcoin (BTC) halving was also crossed and this is a metric some analysts have used as an indicator for the end of a bull market.

BTC/USD 1-week chart. Source: TradingView

As shown on the chart above, previous cycles have seen BTC hit a peak followed by a price decline that first drops below the 50-day moving average (MA) then a culminating capitulation event that thrusts the price below the 200-day MA.

Many traders were thrown off by the lack of a blow-off top in the most recent bull market cycle because this phenomenon has typically marked the late stage of an exhausted trend.

Traders also questioned the validity of the popular stock-to-flow model after BTC failed to hit $100,000 before the end of 2021.

Bitcoin stock-to-flow model. Source: LookIntoBitcoin

During previous market cycles, BTC was trading well above the S2F model at this stage in its progression with the model variance in the positive. Currently, the model variance is giving a reading of -0.86 while the price of BTC is well below the S2F line.

This lack of a blow-off top has prompted some traders to stand by earlier calls for one final price run-up that will see BTC hit $100,000 before entering an extended bear market, but that remains to be seen.

Maybe the market will bottom in November?

While some still hold out hope for one last hoorah before the bear market really sets in, a more pessimistic view is predicting another si months of price decline before the market hits a bottom.

BTC/USD 1-month chart. Source: TradingView

Based on previous cycles, the low in the market came roughly 13 months after the market top, which would suggest a bottom sometime around December of this year if the current trend holds.

This is further validated when looking at the time between a market bottom and the next Bitcoin halving event.

BTC/USD 1-month chart. Source: TradingView

During the previous cycles, each cycle low was hit roughly 17 to18 months before the next halving. The next BTC halving is predicted to occur on May 5, 2024, which would suggest that that the market will bottom in November or December of 2022. 

Related: Bitcoin is discounted near its ‘realized’ price, but analysts say there’s room for deep downside

Traders are still permabulls despite the current price action

As far as price predictions go, there is far less consensus on this matter due to BTC’s underperformance during the last cycle where most traders were expecting $100,000.

Traders continue to call for BTC to the surpass $100,000 mark in the not-too-distant future and a handful are holding on to the penultimate $1 million target.

Bitcoin price prediction chart. Source: LookIntoBitcoin

A general range of possible prices outlined by LookIntoBitcoins’ price prediction tool suggests a BTC high of $238,298, while the delta top indicator indicates a high of $119,886. The terminal price indicator is currently providing a price prediction at $107,801.  

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Jack Dorsey’s Block hits $1.3B in Q1 profits, $43M in BTC trading revenue

Despite the fact that the Bitcoin price trended down over Q1, the Block ecosystem of payment solutions with Bitcoin in mind performed well.

Block, the pro-Bitcoin (BTC) umbrella company that hosts Cash App, Square and Afterpay, continues its growth in 2022. According to its Shareholder letter, in the first quarter of 2022, gross profits are “up 34% year over year.”

In total, the group netted $1.29 billion in gross profits. However, operating costs were also up “$1.52 billion in the first quarter of 2022, up 70% year over year.”  The group explains that the acquisition of Afterpay, a buy now pay later service, could explain the increasing costs.

In total net Block’s revenues reached $3.96 billion from January to March 2022, down 22% compared to 2022. The group confirms that the drop was “driven by a decrease in Bitcoin revenue.”

Cash App, Block’s Bitcoin retail outlet as well as a mobile payment service, continued to sell Satoshis, although the figures are less promising than the previous quarter:

“Cash App generated $1.73 billion of Bitcoin revenue and $43 million of Bitcoin gross profit during the first quarter of 2022, down 51% and 42% year-over-year, respectively”.

In light of Bitcoin prices struggling to break $30,000 in quarter two, the group will take encouragement from an increase in non-Bitcoin revenues in quarter one. On the march by $44 year on year to $2.23 billion, the Block ecosystem, which also includes Tidal and the group TBD is not wholly dependent on crypto market performance.  

Plus, the Square ecosystem of payment solutions for merchants, including point of sale devices, has performed well. It delivered a “gross profit of $661 million, an increase of 41% year-over-year.”

Related: FTX CEO sees no future in Bitcoin payments, community fires back

The quarterly report made 81 mentions of Bitcoin and zero of cryptocurrency, holding true to Jack Dorsey’s Bitcoin-maxi credentials. Furthermore, the report states that over 10 million Cash App accounts have bought Bitcoin. Cash App does not offer the purchase of popular cryptocurrencies such as Ethereum (ETH) or Dogecoin (DOGE). 

In April, it was announced that its customers in the United States could automatically invest a portion of their direct deposit paychecks into Bitcoin using Cash App, or that their “direct deposits” would automatically convert, says the report.