Bitcoin Rebounds Over $41K After Painting A Bullish Hammer – Could BTC Hit The Next $64K?

Bitcoin (BTC) rose above USD 41,000 on Feb. 28, another sign of buying sentiment returning after last week’s brutal sell-off in risk markets, including the S&P 500.

The price of BTC rose more than 9%, reaching $41,300, partly as traders reacted to the ongoing development in the Russia-Ukraine crisis. In doing so, the cryptocurrency briefly broke its correlation with US stock market indices to outperform more like safe-haven gold, whose price also moved higher in early trading Monday.

BTC/USD vs XAUUSD and S&P 500 daily price chart. Source: TradingView

Bitcoin Downtrend Tired – Analyst

Johal Miles, an independent market analyst, spotted “significant buying pressure” in the market, adding that the downward trend could lead to exhaustion.

Miles highlighted Bitcoin’s recent upward retracement moves at test levels near $34,000 as support. For example, on January 24 and February 24, the price of BTC formed a bullish hammer candlestick on the daily chart, indicating a U-turn during an established downtrend.

BTC/USD daily price chart. Source: Johal Miles, TradingView

The same bullish hammers appeared in May and June last year, bottoming out below the key $30,000 support level. This was followed by a sharp price reversal in the Bitcoin market, with the price of BTC reaching a whopping $69,000 in November 2021.

Additionally, Miles noted that buying sentiment in the area between $28,500 and $34,200 was relatively higher than about $46,000, a support that broke Bitcoin down in January 2022.

“The main difference between the current range and the range we previously had at 46k is that we are now seeing significant buying pressure as we visit the lows,” the analyst tweeted Monday, adding:

The spells exhaustion of the downtrend for me, similar to the summer.

BTC to $64K?

Alexander Tkachenko, CEO and founder of VNX – a Luxembourg-based token issuance platform, highlighted Bitcoin’s potential to recover strongly after a confirmed bottom in the US stock market, adding that its price could reach $64,000 based on the Wycoff methodology.

BTC/USD daily price chart with Wycoff model. Source: TradingView

“From a global perspective, all the signs are that Bitcoin has entered the phase of re-accumulation according to Wycoff’s methodology,” he told Coin-Crypto, adding:

“One can expect a move towards $64,000 and a further upward trend in the medium term. Bitcoin’s price potential growth is imminent as projected, particularly based on the currency’s close ties to the mainstream or traditional stock market, the S&P Index.”

Macro analysts also noted that the S&P 500 benchmark may have begun to bottom out after a historic turnaround on Feb. 24. In detail, the index recovered by almost 4.5% despite an initial decline of more than 2.5%. Such a retracement has not occurred since the 2008 financial crisis.

Chris Murphy, co-head of derivatives strategy at Susquehanna International Group, said sharp reversals in stock markets during a price correction “are indicative of a classic bear market rally” except when the economy has not gone through a recession phase.

“Historical precedence says we are” [near the lows of the ongoing correction] if we avoid a recession,” he said told Business Insider while also highlighting improving economic data in the US, ranging from a strong consumer balance sheet to record high corporate earnings to a strengthening labor market.

SPX daily price chart ft. MACD indicator. Source: TradingView

The views were consistent with what FS Insight predicted in its recent S&P 500 market analysis. The company, co-founded by Tom Lee, JPMorgan’s former stock strategist, noted that the index was showing signs of a low.

Related: Hodl, Don’t Trade, Says the AI ​​Bitcoin Trading Bot

“Prices remain below the highs of recent days amid a negative trend with bearish momentum,” said Mark Newton, FS’s head of technical strategy, adds in a note:

“I prefer to be long and buy dips, expecting markets to work higher through March FOMC and growth to outperform value.”

The correlation between Bitcoin and S&P 500 was above 0.36 on Feb. 28, 16:30 UTC.

The views and opinions expressed herein are solely those of the author and do not necessarily reflect the views of Every investment and trading move involves risks, you should do your own research when making a decision.

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