Analysts at the financial outlet Bloomberg say Bitcoin may be hitting a wall and on the verge of a pullback.
The proprietary DVAN Buying and Selling Pressure indicator, which is designed to track BTC’s price, trend line and ideal exit points, is now printing a sell signal.
The indicator suggests Bitcoin’s 2020 rally may have stalled, with its first line of support standing at $9,500.
The crypto analytics company Santiment is also analyzing Bitcoin’s repeated attempts to sustain a rally above the psychological level of $10,000. Despite the firm’s “cautious optimism” on BTC, Santiment says Bitcoin’s trading volume remains king, and a surge in volume is required to power a renewed rally.
“…The rising price and falling trading volume does remain a concern as it indicates a bearish-ness in the air. This was also observed in the 2nd attempt to break $10,000 but failed.”
On the positive side, Santiment says its MVRV Long/Short Difference Indicator, which calculates the average profitability of all Bitcoin holders, has flipped bullish.
“Historically, when the MVRV Long/Short difference begins to rise above 0, it indicates the end of a bear cycle and we see the price moving upwards. And….. we just went above 0 a few days ago. If the aliens don’t invade us or the world [doesn’t] face yet another black swan event, we might just continue this run.”
As for the overall sentiment of the crypto markets, Santiment says data from Twitter suggests traders are fearful about BTC’s short term trajectory.
Traders were in a similar state of mind back in June of 2019, when sentiment turned negative as BTC dropped from $8,500 to $7,800. After the pullback, BTC then surged to its 2019 high of nearly $14,000.
At time of publishing, Bitcoin is down 0.27% in the last 24 hours at $9,707, according to CoinMarketCap.
