Summary
- Bitcoin is currently priced at $66,208 after rebounding from a dip to the $53,000–$54,000 range, supported by the daily 200 EMA.
- The death cross, indicating the 50 EMA is below the 200 EMA, remains visible on the daily chart.
- According to Myriad, 64.6% of traders predict Bitcoin will reach $55,000 before hitting $84,000, aligning with the technical analysis and a prolonged negative Coinbase Premium.
This week, Bitcoin has drawn significant attention within the cryptocurrency market, and the recent chart movements have provided some reassurance.
As of Wednesday afternoon, Bitcoin has climbed back to $66,347 after recently testing lows around $58,000. The 200-period exponential moving average has acted as a support level, and the death cross, which traders have been monitoring, appears to be narrowing, igniting hopes for a future golden cross.
However, the macroeconomic landscape remains uncertain.
On Wednesday, U.S. stock markets opened mixed as investors prepared for important tech earnings from Alphabet and Tesla. The S&P 500 decreased by 0.16% at the opening bell, while the Nasdaq fell by 0.56%, reflecting a cautious atmosphere on Wall Street ahead of AI-related earnings that could influence market direction. The Crypto Fear & Greed Index is currently at 33, indicating caution rather than panic, which presents a unique standstill.
Currently, two opposing forces are influencing Bitcoin's trajectory. On the bullish front, Treasury Secretary Scott Bessent informed lawmakers that the Clarity Act is nearing completion—this long-delayed legislation aims to clarify the jurisdictional dispute between the SEC and CFTC regarding the crypto market—and he urged Congress to pass it before the recess on August 7.
Conversely, the Coinbase Premium Index, which measures whether U.S. institutional buyers are paying more than global retail prices, has remained negative since May. Daniela Hathorn, a senior market analyst at Capital.com, interprets this persistent caution among institutions as indicative of a broader risk aversion rather than a decline in crypto-specific fundamentals. This suggests a macro-driven situation rather than panic, but also a lack of buying interest.
Regarding Bitcoin's price, the daily candle on July 22 opened at $66,520, reached a high of $66,698, and fell to $65,488, currently settling around $66,208—down 0.47% for the day. The daily price range has been relatively tight, but a solid support level around $65,000 has proven effective.
The cryptocurrency rebounded near this support level to its present price.
Bitcoin price data. Image: TradingviewThe exponential moving average (EMA) is a type of moving average that gives greater weight to recent prices. The 200-day EMA reflects the overall trend. When Bitcoin approaches this line and buyers respond, it indicates genuine demand at that level. This scenario unfolded here, with the 200 EMA providing support and allowing Bitcoin to recover. For long-term holders who witnessed the price drop sharply, this serves as a signal to take notice.
Nonetheless, the EMA structure remains bearish overall. The chart reveals the 50-day EMA is positioned below the 200-day EMA, forming what traders refer to as a death cross. This indicates that the shorter-term trend is weaker than the longer-term trend. In other words, long-term holders are experiencing greater losses than those who bought recently at lower prices.
The Average Directional Index (ADX) stands at 19.5. This index gauges the strength of a trend on a scale from 0 to 100, indicating conviction rather than direction. Readings below 25 are typically categorized as lacking a trend. At 19.5, Bitcoin is firmly in this zone, suggesting movement without momentum. Interestingly, this can be seen as positive for traders: a low ADX during a bearish trend indicates that the downward movement is losing strength.
The Relative Strength Index (RSI) is at 59.9, representing the most optimistic signal available. The RSI measures buying momentum on a scale from 0 to 100. Values below 30 indicate oversold conditions, while those above 70 indicate overbought conditions. At 59.9, Bitcoin is in bullish territory—above the neutral line of 50—without being overextended enough to trigger automatic selling by momentum traders. There remains room to grow before the chart indicates a potential downturn.
On Myriad, a prediction market created by Decrypt's parent company Dastan, traders have set specific expectations for this Sunday. The market assigns only a 19% chance that Bitcoin will surpass $68,000 by July 26 at 4 PM UTC. Meanwhile, the market for $66,000 is nearly a coin toss, with traders slightly favoring a bullish outlook at 55%. Currently, traders believe the existing range will hold, which aligns with the low ADX and the technical analysis indicating a potential squeeze: something is likely to happen, but it may not be immediate.
In the long-term Bitcoin market on Myriad, traders remain skeptical, pricing in a 64.6% likelihood of a decline to $55,000 before a rise to $84,000. This reflects a significant majority leaning towards the bearish outlook, consistent with the negative Coinbase Premium, the ongoing death cross on the daily chart, and the weak ADX reading indicating this rally lacks strong conviction.
The bullish case hinges on three factors: the 200 EMA has held as support, the RSI is above 50 with potential for further gains, and the Clarity Act is closer to being enacted than it has been in recent months.
A favorable vote in the Senate could serve as the catalyst that propels Bitcoin with sufficient momentum to trigger a short-liquidation surge towards $70,000. Analysts at Bernstein maintain a year-end target of $150,000, acknowledging that the current price is "ambitious in the context of the market correction" but still supporting their thesis.
On the other hand, the bearish case carries more technical weight at this time. The death cross remains in place, the ADX at 19.5 indicates a lack of real trend momentum supporting this rebound, and over 900 hours of negative Coinbase Premium suggests institutions are not accumulating Bitcoin. Furthermore, the statistical squeeze may resolve in the direction of the preceding trend, which is downward.
Disclaimer
The views and opinions presented by the author are provided solely for informational purposes and do not constitute financial, investment, or other advice.