Why is Bitcoin Price not Crashing Today?
Bitcoin is currently trading above the key $95,000 level and has gained over 3% in the past 24 hours. The largest cryptocurrency is showing signs of short-term bullish divergence as it attempts to move back towards key Fibonacci levels. This coincides with a new bullish crossover on Bitcoin indicators.
According to Santiment, Bitcoin’s Average Dollar Investment Age (MDIA), which tracks the average age of coins in wallets, has dropped significantly since mid-October 2023, signaling a bullish trend. This drop indicates that coins that were previously sitting idle in wallets are now circulating. The average age of Bitcoin dropped from 637 days to 466 days, a drop of 27%, and a drop of 9% in the past three weeks alone. As long as MDIA continues to fall, it indicates that the market is in a bull market stage.
Think about the big picture
Crypto World Analyst Josh Bitcoin remains bullish overall, showing strong signs of a potential long-term bull market despite some short-term pullbacks. However, resistance remains at the 16.8 Fibonacci extension level, around $100,000 to $102,000.
Bitcoin is trying to regain levels around $94,000 to $95,000. After briefly falling below this level, it is currently trying to break above it. A close above $95,000 in the coming days could signal a positive move in the short term.
The next resistance level to watch
If Bitcoin manages to break above $95,000, the next areas of resistance will be around $100,000 and $102,000. If Bitcoin confirms a break above these levels, it could push it to $113,000. On the downside, if a pullback occurs, we may see support around $89,000.
Short term bearish divergence
In the short term, Bitcoin still shows a bearish divergence on the 12-hour chart. This means there could be some volatile price action in the coming days. While this may result in a slight pullback or sideways movement, it is not necessarily a major problem. In the past, similar patterns have resulted in breakouts following periods of consolidation.
Breaking the $100,000 mark
If Bitcoin breaks through $100,000, it could trigger a severe short squeeze that could push the price significantly higher. This is similar to what happened during the last bull cycle when Bitcoin broke through the $20,000 mark.
