There are early signs of a return to normalcy in the cryptocurrency market, now that investors believe the worst seems to have happened when Terra (LUNA) collapsed. An examination of the bitcoin chart shows that while the fallout is widespread and quite disastrous for altcoins, bitcoin (BTC) has stood really well.
While the May 12 fall to $ 26,697 marked the lowest price level since 2020, many metrics suggest that current levels may indicate a good entry in BTC.
The withdrawal at this level is notable in that it was a retrial of the 200 week bitcoin exponential moving average (EMA) at $ 26,990. According to cryptocurrency research firm Delphi Digital, this indicator is historically “ it has previously served as a key area for low prices “.
And it’s not just bitcoin that had a rough day on May 12th. The market for stable tires also had the highest level of volatility and deviation from the peg dollar since the beginning of the Terra saga, with Tether (USDT) suffering the largest deviation among the major encryption projects. stable tiresas seen in the chart below from blockchain data provider Glassnode.
The four main stable tires in terms of market capitalization they managed to return within $ 0.001 of their dollar pins, but the confidence of cryptocurrency holders in their ability to hold on has certainly waned at the events of the past fortnight.
Read also: Your Kwon summoned to parliamentary hearing after UST and LUNA collapse
Bitcoin is approaching its realization price
Following the market downturn, the price of bitcoin is now as close as possible to its realized price since 2020.
According to Glassnode, the price has historically been realized “ provide strong support during bear markets and signs of bottom market formation when the market price is trading below “.
Bear markets have previously seen BTC trade price below its realized price for long stretches, but the duration has actually declined with each cycle, with bitcoin spending only seven days below its realized price during the 2019-2020 bear market .
It remains to be seen whether BTC will fall below the realized price if current market conditions continue, and if so, how long this will last.
Details on a chain show Many cryptocurrency holders could not resist the temptation to get bitcoins below $ 30,000, which led to a spike in accumulation from May 12 to May 15, but some analysts have warned not to take this as a sign of recovery fast from here.
If history is any indication, most #BTC The bottoms of the Bear market are creating fast, volatile fashion
But the accumulated ranges that are formed later take time
There may be plenty of time to accumulate on deeply discounted prices $ BTC #Crypto #Bitcoin
– Rekt Capital (@rektcapital) May 13, 2022
If history has to do, most bears create #BTC bears quickly, in a volatile way.
But the beaches take accumulation which then forms time.
There may be plenty of time to accumulate on a big $ BTC #Crypto #Bitcoin discount
– Rekt Capital (@rektcapital) May 13, 2022
This attitude was echoed by Delphi Digital, who noted “ The more we see price rising in these areas the more likely it is to continue “.
Delphi Digital said:
“Where this happens, look at the following levels: 1) Support weekly structure and volume structure at $ 22,000 – $ 24,000; 2) Full-time 2017 high-level retests of $ 19,000- $ 20,000. »
The views and opinions expressed herein are those of the author only and do not necessarily reflect the views of Cointelegraph.com. Every investment and every trading operation involves risk, you should do your own research before making a decision.
