Despite the bear market, Bitcoin price is reacting well to the bullish developments that have taken place over the last month. That’s what analyst Akash Girimath points out.
So, according to him, even a low over the weekend could be the start of a prolonged rally.
“When viewed through the lens of Bitcoin’s historic fourth-quarter performance, BTC bounces back in November,” he said.
Thus, according to him, the average return on BTC in November is around 15%.
“While historical performance is not a surefire way to predict the future, it is a great guide. As such, it is possible that if the cycle repeats itself in 2022, investors could see an explosive move north in the next couple of months,” he said.
He highlights that Bitcoin price had a bullish divergence on the three-day chart that developed between June 30 and October 25. Thus, this technical formation happens when price drops are not reflected in similar drops in the Relative Strength Index (RSI).
Therefore, he points out that this non-confirmation by the RSI is usually a sign of weakening bearish momentum. Thus, it can be an indication of the approach of a market reversal, that is, a new high rally.
“The $25,000 hurdle is the midpoint of the 45% move that took place between May and June and is a pivotal point in BTC’s journey. Launching this resistance level at a support floor will indicate a bullish resurgence and boost the price of Bitcoin. So the next significant area is between $28,000 and $29,000,” he says.
However, he points out that a breakout of the control point at $18,981 would invalidate BTC’s bullish thesis. As such, this development could trigger a new drop that could bring the cryptocurrency down to $17,593.
“Here, buyers have another chance to step in, accumulate BTC and potentially start a recovery.”