- Bitcoin’s adjusted SOPR holds at 0.97, eliciting price rebound calls.
- BTC may set out for a 51.2% move to $48,505 if a falling wedge pattern is confirmed.
- The uptick above $30,000 might face immense resistance at $32,000 and $34,000; thus, delaying the expected upswing.
Bitcoin has a lot to prove to investors before sentiment shifts positively for the much-awaited rally. From a technical perspective, a sustainable recovery may take a while to play out but macro factors like the SOPR suggests that the only way from here is upwards.
What Does The Adjusted SOPR Tell Us
Following a correction from a bullish stint to levels marginally above $31,000 on Tuesday, Bitcoin’s price retested the support sitting above $29,000. At the time of writing, BTC had already reclaimed $30,000 and was doddering at $30,550.
Meanwhile, the adjusted Spent Output Profit Ratio (aSOPR) held below the mean line according to on-chain data from Glassnode. According to Glassnode Academy, this metric “provides insight into macro market sentiment, profitability, and losses taken over a particular time-frame. It reflects the degree of realized profit for all coins moved on-chain.”
Note that a SOPR value less than 1 infers that coins moved on the day are on average selling at a loss. At the moment, Bitcoin’s SOPR holds at 0.97, suggesting that this could the period to accumulate. This is to say that as more people sell at a loss, it would be recommendable to heed the calls to buy. Besides, fear often precedes great potential.
At the same time, the crypto fear & greed index improved slightly to 17 after dropping to 8 in May. Insights from Alternative outlined that extreme fear could signal a buying opportunity. Therefore, for a long-term holder, it would be essential to sift through the chaff and look at the long-term outlook, which to a great extent, appeared bullish.
Crypto Fear & Greed Index
Technical Levels Adjust For A Possible Swing
The weekly chart illustrated the formation of a falling wedge pattern likely to set Bitcoin on a 51.2% growth path to $48,505. Traders consider this pattern to be bullishly biased. In other words, it occurs after a significant drop in price and has the potential to mark the beginning of a trend change.
BTC/USD Weekly Chart
Nonetheless, this forecast is likely to take time to come to fruition especially with the Moving Average Convergence Divergence (MACD) spotting a sell signal. For Bitcoin to flip sustainably bullish, the 12 EMA has to cross above the 26 EMA. Furthermore, upward momentum would strengthen as the MACD lifts towards the mean line.
In the short term, Bitcoin’s price was going to face resistance at $32,000 and $34,000. On the downside, the areas to keep in mind are $28,000 and $25,000, respectively.