Bitcoin Bounces Back: Bull Signal Returns After Brief Dip

The Bitcoin market mood has swung back to positive after a short scare. The bull-bear cycle indicator, which tracks investor sentiment, now points to bullish conditions. This comes after three days of warning signs as Bitcoin’s price fell to levels not seen since February.

CryptoQuant founder Ki Young Ju said on X, “Most Bitcoin indicators that were close to the edge have now moved back to showing a bull market.” Trader PlanB agreed, stating, “Bitcoin is still in a bull market.”

Source: CryptoQuant

Ju claimed, “BTC was on sale for only three days.” This analysis follows Bitcoin’s drop to $49,751 on August 5, dubbed “Crypto Black Monday.” It was the first time Bitcoin fell below $50,000 since February.

Bitcoin traded under the key $60,000 mark until August 8. At the time of writing, Bitcoin trades at $60,732.

Source: CoinMarketCap

The bull-bear cycle indicator had not shown a bear signal since January 2023, shortly after FTX collapsed. Other signs also pointed to fear in the market. The Crypto Fear and Greed Index hit an “Extreme Fear” score of 17 on August 6, the lowest since the FTX crash. It has since bounced back to a “Neutral” 48.

Some traders think this quick turnaround might mean the recent price drop was a trap for short-sellers.

Experts disagree on Bitcoin’s next move. Markus Thielen from 10x Research said, “To time the next bull market entry well, we’re aiming for Bitcoin prices to fall to the low 40,000s.”

Cathie Wood’s Ark Invest reported that Bitcoin’s critical price supports are at $52,000 and $46,000.

Veteran trader Peter Brandt noted that Bitcoin’s “fall since halving is now like the 2015-2017 halving bull market cycle,” hinting that a price rise may follow.

The quick shift in market sentiment has left investors and analysts split on Bitcoin’s future. While some see the recent dip as a buying opportunity, others remain cautious, expecting further price drops before a sustained bull run. As always, the crypto market keeps participants on their toes with its rapid changes and conflicting signals.

Furthermore, the author’s views are for reference only and shall not constitute investment advice. Before purchasing, please ensure you fully understand and assess the products and associated risks.