- Bitcoin rose nearly 18% in July.
- As the month end approaches, several indicators are pointing to bullish price action for the top crypto.
- Bitcoin needs to hold above $20,650 to advance towards $31,340.
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Bitcoin is approaching the monthly candlestick with strength as it holds above a significant support area.
Bitcoin closes July in the green
Bitcoin is about to close July in the green as a technical indicator appears to be flashing a buy signal.
The leading cryptocurrency rallied nearly 18% in July after enduring a brutal 56% correction in the second quarter. The upward price movement seen over the past month coincides with improved market sentiment. Although the US economy has entered a so-called “technical recession” after two consecutive quarters of negative growth, investors indicate that they believe the weak macroeconomic conditions have been priced in.
From a technical perspective, Bitcoin is holding around the 50-month moving average. Meanwhile, the Tom DeMark (TD) Sequential indicator looks like it is about to present a buy signal in the form of a red nine candlestick on the monthly chart. The bullish formation expects a rise of one to four monthly candlesticks or the beginning of a new uptrend.
Transaction history shows the importance of the 50-month moving average. About 3.67 million addresses have bought 2.47 million BTC at an average price of $20,650. If this significant wall of demand continues to hold, Bitcoin has a chance to validate the optimistic outlook.
Further buying pressure around the 50-month moving average could push Bitcoin towards $31,340 as IntoTheBlock’s Global In/Out of the Money model shows little to no resistance going forward.
It is worth noting that a loss of the $20,650 support level could lead to a major decline. Diving below this interest area can cause panic among investors, which can lead to potential selling as market participants try to avoid further losses. The potential selloff could push Bitcoin to the next key support area, which is around $11,600.
Disclosure: At the time of writing, the author of this piece owned BTC and ETH.
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