Bitcoin (BTC) broke out to a new six-week high on July 31 as the weekly and monthly closing price showdown looms.
‘Bart Simpson’ welcomes traders into BTC monthly close
Data from Cointelegraph Markets Pro and TradingView showed that BTC/USD erased all gains earlier in the weekend, falling from $24,670 to $23,555 within hours.
The resulting chart structure is all too familiar to long-term market participants, creating a “Bart Simpson” shape on the hourly time frame.
Still, according to analytics resource Coinglass, liquidations are still manageable, with a cross-crypto total of $150 million in the 24 hours to the time of writing — down from previous days.
For popular trader and analyst Rekt Capital, there is no reason to believe that the upcoming weekly candle close will confirm that Bitcoin has re-established a key trendline as support after weeks of failure.
Looks like #BTC has successfully retested the 200-week SMA as support for $BTC #Crypto #Bitcoin pic.twitter.com/yg75xrxXQB
— Rekt Capital (@rektcapital) July 30, 2022
Looking ahead, however, not everyone is convinced that the current market strength has much room to continue.
In various Twitter posts over the weekend, Material Scientist, creator of on-chain analytics resource Material Indicators, noted that funding rates on derivatives platforms have become increasingly positive, suggesting that the consensus that prices could rise uncontrollably is too strong.
“As in late March, negative funding has almost completely reset. We may even see positive funding for some alternatives soon,” he wrote:
“I think the last time it will be in the shaded area before the bear market rally subsides.”
Still, BTC/USD is on track for a monthly gain of around 19% in July, in stark contrast to any other month so far this year.
July’s return is even on track to be Bitcoin’s best since its 2021 all-time high, according to Coinglass data.
One of the ‘biggest bull markets’ can now await Bitcoin
Other views pay little attention to the prospect of a fresh pullback in the near term.
Related: Historically Accurate Bitcoin Indicator Exits Buy Zone in ‘Unprecedented’ 2022 Bear Market
Looking ahead to potential performance in the second half of 2022, Mike McGlone, senior commodities strategist at Bloomberg Intelligence, has no doubts about Bitcoin’s performance.
Federal Reserve Chairman Jerome Powell said this week that the Fed will address rate hikes on a “meeting-by-meeting basis,” he said on social media, “which could mark a return to #Bitcoin’s trend of outperforming most assets. The essential.”
“July marked the biggest discount to its 100-week and 200-week moving averages in Bitcoin’s history, which means it will recover,” he added about the 200-week trendline:
“I think the risk-reward tilt in one of the greatest bull markets in history is tilted in favor.”
The views and opinions expressed here are those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk and you should do your own research when making a decision.