Bitcoin clings to $23.5k as trader says BTC ‘identical’ to 2020 breakout
Bitcoin (BTC) hovered around $23,500 on February 4 as bulls refused to give up support in after-hours trading.
Bitcoin price brings back memories of 2020
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD holding a narrow range in place since the Wall Street open on February 3.
US macroeconomic data releases provided modest volatility but no overall trend change as traders bided their time towards the weekend.
However, opinion on the long-term outlook was mixed, with some arguing that there was little reason to trust that Bitcoin’s rally would continue.
“We are seeing $50,000 calls already on Bitcoin and we have yet to complete a higher high and higher low market structure change,” popular trader Crypto Tony in summary in part of a tweet on the day.
More optimistic was fellow trader Credible Crypto, which doubled down on a theory comparing current BTC price action to that of late 2020, just after Bitcoin had passed its old 2017 all-time high.
“The price action has developed beautifully from our lows, mimicking the bottom formation that preceded our last impulse from 10k-60k+. Current consolidation (circled in green) also looks identical to the PA from that impulse,” he wrote in an update to a corresponding Twitter thread.
“BTC may continue to pump while most await a pullback…”
Others were concerned about a reversal in the fortunes of the US dollar, which could affect risk assets across the board if it were to continue.
The US Dollar Index (DXY) “rang the alarm bells” for popular trader Bluntz, who revealed a segue to stablecoins.
“After such a long and deep selloff, do we think DXY is already done to the upside? I don’t. Lotta shorts to squeeze yet,” macro investor David Brady commented on the dollar’s decline from twenty-year highs in Q3 2022.
RSI ready for “bullish continuation”
Focusing on monthly time frames, meanwhile, trader and analyst Rekt Capital saw a potential signal for Bitcoin to fall before continuing higher.
Related: Bitcoin due for new ‘huge rally’ as RSI copies 2018 bear market recovery
This came in the form of its Relative Strength Index (RSI), which in January bounced off an all-time low to regain an important support level.
While he acknowledged that historically Bitcoin markets “haven’t really seen double bottoms” in the RSI, he argued that there was still a chance that a higher low could come next.
“Now it’s just a matter of confirming and keeping these levels consistent and stable – that’s what we really want to see for a bullish continuation,” he concluded in a YouTube video released on February 3.
A Twitter examination from Rekt Capital likewise delivered a narrow consensus that there would be a dip for BTC/USD.
The views, thoughts and opinions expressed herein are those of the authors alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
