Bitcoin maintains a bullish trend despite a recent 23% drop, currently valued at $84,555. Historical data indicates recovery potential, supported by factors like mining difficulty and declining exchange supply. Analysts note a potential correlation with rising gold prices. Technical indicators show ongoing bullish signals, with projections suggesting Bitcoin could rise to $123,585 unless it drops below $73,685, which would invalidate this outlook.
Bitcoin continues to exhibit a bullish trend as per long-term price analysis, despite a 23% decrease from its highest value earlier this year. As of Good Friday, Bitcoin (BTC) was valued at $84,555, reflecting a 13% increase from its annual low, resulting in a market capitalization exceeding $1.68 trillion. However, it has still seen a 10% decline year-to-date, outperforming the Nasdaq 100 index’s 13% drop.
Historical trends indicate that Bitcoin generally follows an upward trajectory even after experiencing significant dips. For instance, the cryptocurrency fell 35% between March and August last year before recovering. Comparatively, Bitcoin’s earlier drop from $68,980 in November 2021 to its 2022 low coincided with rising interest rates and failures of major crypto firms like Celsius, Terra, and FTX.
Despite the current market pullback, Bitcoin’s strong fundamentals suggest potential recovery prospects. Mining difficulty has hit record levels, leading to a reduced influx of new coins into circulation. Concurrently, the number of Bitcoins available on exchanges has steadily decreased, dropping from 2.44 million in September to 2.18 million, indicating reduced selling activity among holders.
Additionally, the recent spike in gold prices, which have surged over 25% this year to reach an all-time high, may serve as a barometer for Bitcoin. Historical data shows that Bitcoin tends to mirror gold trends with a delay of approximately 100 to 150 days.
Technical analyses reinforce Bitcoin’s ongoing uptrend, as evidenced by the weekly chart. Bitcoin’s price has consistently found support at the 50-week Exponential Moving Average since October 2023, failing to dip below it. Furthermore, Bitcoin has maintained a position above the Ichimoku Cloud indicator, signalling bullish momentum.
Importantly, Bitcoin has surpassed the critical level of $73,685, which represents the upper boundary of a cup-and-handle formation, a known bullish pattern. This cup has a significant depth of 78%. If this distance is applied upward from the established price ceiling, potential gains could project Bitcoin to $123,585, approximately 45% higher than its current value. However, a decline below the key support level at $73,685 would invalidate this optimistic outlook.
