The situation on the main cryptocurrency became a little clearer this week when the price of BTC/USD reversed after a false breakout of the support at 31,082.82 (marked with a red dotted line on the chart).
But technically, there is still some uncertainty, since it is not yet clear whether this is a local correction before an even bigger drop or the beginning of a recovery in the area of $40,000 per coin.
Analysts and influencers also disagree about whether the cryptocurrency is currently in a bull or bear market. And this is not surprising, since even from a technical point of view, trading what you see, and not what you know, it is difficult to give an unambiguous answer.
For example, analysts at JPMorgan point out that there are currently no signs that the bear market for bitcoin will end anytime soon. The bank's analysts have yet to find signs that the worst is over for the main cryptocurrency.
They see the increase in bitcoin's dominance ratio above 50% as a sign of the end of the bear market. Now it is about 46%. And at the beginning of the year, it reached a maximum near 70%.
The situation with institutional demand also does not please JPMorgan. The fact that some companies, such as Ark Invest and MicroStrategy, have been buying bitcoins in recent weeks, the bank considers insufficient.
"These institutional deals are not encouraging at all. They do not reflect new participants, but rather existing investors interested in maintaining bitcoin prices," JPMorgan noted.
Nevertheless, ARK Invest deals and statements from bitcoin bulls Elon Musk, Jack Dorsey, and Cathie Wood allowed bitcoin to stay above $30,000 per coin this week.
But a CryptoQuant analyst believes that bitcoin remains in a bullish cycle, despite the recent 50% correction.
He made this conclusion by analyzing MVRV (the ratio of market value to realized value). CryptoQuant data shows that since 2013, the periods when bitcoin was falling, turned out to be the best time to buy before its rally.
The analyst agency has previously stated that the bear market for bitcoin has not occurred according to data based on MVRV. The ratio of market value to realized value shows the ratio of the market price of an asset to its realized capitalization.
Despite the conflicting views of influencers, ordinary traders who make money on speculation, in my opinion, should trust technical analysis. While the scenario of growth to the level of 34,708.27 remains in force. And there we will probably get more information about whether bitcoin will follow the triangle scenario or continue to recover sideways in the area of $40,000 per coin.
