“The downtrend has ended, and a new uptrend is ongoing,” one analyst suggested.
The primary cryptocurrency has posted a 6% price increase over the past week, and now many analysts believe a further ascent could be on the way.
However, a number of warning signs suggest a short-term correction remains just as plausible.
Climbing Towards New Peaks?
Bitcoin has been gradually rising over the last several days, briefly touching $83,000 on May 6 before reversing to the current $81,000 (according to CoinGecko). Its resurgence comes on the back of a broader market revival triggered by the recent peace talks between the USA and Iran, among other factors.
Numerous industry participants are optimistic that BTC’s rally is nowhere near its end, with John Bollinger joining the discussion. The legendary technical analyst revealed that his fund’s “Tactica” program has opened a new position and is now “fully invested” in the cryptocurrency after the trend model turned positive.
This method is used at Bollinger Capital Management as a systematic allocation tool, automatically adjusting the entity’s exposure based on predefined signals.
The analyst is better known for developing the Bollinger Bands indicator, which consists of a moving average with an upper and lower band that expand and contract based on market turbulence. Some X users noted that, towards the end of April, these channels squeezed as never before on a monthly basis, which is usually a precursor to a big price swing.
Other market observers who have touched upon BTC’s performance lately include CW and Aman. The former argued that the asset has begun “a full-cycle rise after completing a retest following a convergence breakout.”
You may also like:
“The downtrend has ended, and a new uptrend is ongoing,” they added.
For their part, Aman wondered if BTC is ready to “vaporize” the $86K wall. The analyst claimed that the price has entered a specific zone where the big players will decide the trend.
The Biggest Bull Trap?
It is important to note that some industry participants expect the recent upswing to be abruptly replaced by a major pullback. X user Chiefy, for instance, described the current development as “the biggest Bitcoin bull trap of this cycle,” envisioning a collapse to as low as $42,000.
At the same time, the asset’s social sentiment has jumped sharply, with Santiment showing a 1.37 bullish versus 1.00 bearish ratio – the most optimistic reading in nearly four months. While this surge in confidence highlights growing trader enthusiasm, it can actually be a bearish sign, as the crypto market tends to move against the crowd’s expectations.
The ratio of leveraged positions also displays the reigning optimism among market participants, which could serve as another warning signal. According to X user Ted, longs have outnumbered shorts by about 11 to 1.
No Comment! Be the first one.