This indicator shows that the bottom is here or nearby

The primary cryptocurrency has recovered slightly in recent days and was able to regain the $ 20K level. This area is the previous 2017 ATH and acts as a psychologically significant support price level, which could potentially trigger a short-term emergency rally.

Technical and chain analysis of Shayan

The daily chart

Bitcoin has formed lower lows and lower highs in recent months, which can be seen by the following yellow declining trend line in the medium term. The trend line has rejected the price twice (marked with red arrows) and started a new bearish leg. The price must break over the trend line and then aim for the upper limit of the long-term descending channel, marked in orange.

In addition, 50-day and 100-day moving average lines, alongside the long-term channel’s upper trend line, are the main obstacles in Bitcoin’s path to a new all-time high.

4-hour chart

After breaking the middle channel of the blue channel, the price formed a bullish leg as a confirmation of the eruption (marked with a green arrow) and rose to the upper limit of the triangle. This jump followed a significant bullish momentum which resulted in an outbreak of the decisive triangle pattern.

As mentioned in our latest analysis, the triangular pattern can become a continuation or a reversal pattern, depending on the direction the price breaks out. Given that the price has broken the triangle to the upside, a short-term withdrawal to the upper limit of the triangle and a new rally to $ 28K is the possible scenario for Bitcoin.

However, we should always consider the option with an ox trap, where the price is rejected from this area and plunges to re-test the critical zone of $ 17K- $ 20K. If the price breaks below the current lowest level in 2022 of 17,000 dollars – a steep crash against 15,000 dollars would be inevitable.

Analysis on the chain

The following chart shows Bitcoin’s realized ceilings next to market value. Realized capitalization measures the total USD value of all coins when they are transferred. In contrast, the market value measures the present value of the asset by multiplying the total offer and the price in USD.

Historically, bear market bottoms had formed when Bitcoin’s market value crossed below the realized value. The mentioned cross means a lifelong investment opportunity as the entire market as a whole enters an unrealized loss area which happens extremely rarely.

As shown in the following chart, Bitcoin’s market value has already plummeted below its realized value, indicating the beginning of its final capitulation phase and possibly the bottom of this bear market.