Following an epic 37% rally this year, Bitcoin realized profits are back in the green zone. Will BTC continue on to its next resistance level, or was it a bull trap?
Bitcoin on-chain metrics are looking stronger following a rally that has lasted almost three weeks. Furthermore, price levels are now back above a number of key technical indicators, but it may be too early to call a full bull market reversal.
On Jan. 27, renowned analyst ‘PlanB’ reported that Bitcoin realized return had turned positive again. Sellers are now taking profit instead of cutting losses, he noted.
Realized return is the amount of actual gains made on an asset’s value over a specific period of time.
Bitcoin Approaches 200W MA
Bitcoin is now also trading comfortably higher than its realized price. This is a metric of the value of all BTC in circulation at the price they last moved. It can also be considered an approximation of what the entire market paid for their coins.
The realized price is currently $19,785, according to Woo Charts. BTC crossed this threshold on Jan. 13 and has remained above it ever since.
The next milestone it needs to tackle is the 200-week moving average. This metric has traditionally been an indicator of the bear market floor. The 200w MA is currently at $24,685, which is the next target to confirm the uptrend.
Additionally, market sentiment has also improved with the BTC fear and greed index entering ‘greed’ territory. It is the highest the index has recorded since late March 2022.
Capriole Fund founder Charles Edwards commented on the FTX collapse and how BTC has bounced back yet again:
“It’s like it never happened. Many thought it was the end of our industry, but Bitcoin always comes back from the purging of bad actors stronger than ever. Nothing will stop the relentless adoption rate of this industry.”
Price Outlook
BTC was trading at $22,797 at the time of press following a 1.7% decline on the day. The asset has been consolidating at the $23,000 level for almost a week.
Its next target is $24,400, a price not seen since mid-August 2022. If this current resistance zone can be broken, there isn’t much in its way until $30,000.
Disclaimer
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