Bitcoin bounces 8% from lows amid warning BTC price bottom ‘shouldn’t be like that’

After BTC/USD was dangerously close to its high, Bitcoin (BTC), spared hodlers from the pain of losing $20,000 June 15, after BTC/USD had fallen to $20,000.

BTC/USD 1-hour candle charts (Bitstamp). Source: TradingView

Nobody believes Bitcoin is “bottom”.

Data from TradingView and Cointelegraph Markets Pro showed that BTC/USD surged higher after Bitstamp reached $20,079

The pair, which had been selling off, remained in the same direction as US equities, rising to $21,700 at the Wall Street Open. After the opening bell, the S&P 500 gained 1.4% while the Nasdaq Composite Index managed 1.6%.

Commentators stated that the market’s renewed strength was due to the majority of investors already pricing in significant Federal Reserve rate increases, which will be confirmed today.

However, crypto was the most affected by the inflationary environment, noted Mike McGlone, Bloomberg chief commodity strategist. He tweeted that he had contrasted Bitcoin’s and altcoin’s performance with skyrocketing commodities like WTI crude oil futures, which are now trading at nearly twice their 200-week moving mean.

“Unprecedented Crude Spike” Bottoms in Bitcoin, Bonds and Gold — The historically extreme stretch of crude oil futures above its 200-week average is sufficient fuel for inflation, consumer sentiment to plunges, Federal Reserve rate increases to accelerate, and an enduring hangover,” he stated.

WTI crude oil futures 1-week chart with 200-day moving Average. Source: TradingView

Many were skeptical that Bitcoin would be able to sustain the low $20,000 area despite suppressed price action.

Crypto Tony, a popular trader and investor, stated that “we have yet to see capitulation on the Crypto markets,” according to his followers on Twitter.

It is getting closer, but it doesn’t feel that way yet. Every bounce is full of optimism, and it shouldn’t be that way.

Rekt Capital, a fellow analyst and trader, agreed that there had not been sufficient volume to support the sell-off.

He wrote that BTC is selling well in all markets.

“Undoubtedly, Seller exhaustion lies ahead. Look out for high volume sell-side bars. These bars indicate bottoming after continuous selling and precede a complete trend reversal over the course of time.

Cointelegraph reported that Bitcoin’s 200-week moving average was $22,400. Rekt Capital warned that this level could become a price magnet for several weeks or even months.

Data shows that losses do not always equal “capitulation”.

Data showed that panic selling was a common phenomenon in the short-term.

Related: Bitcoin miners exchange flow reaches 7-month peak as BTC price drops below $21K

According to CryptoVizArt, weekly realized losses were 2.6% of Bitcoin’s realized cap. This is the highest level ever according to data from Glassnode, an on-chain analytics firm.

The #BTC realized cap is 2.6%. This chart illustrates historical examples where this ratio was >2.5%. pic.twitter.com/jbl3aD5WmJ
— CryptoVizArt.btc /21M – LOST #BTC (@CryptoVizArt) June 15, 2022

The net unrealized profit/loss (NUPL), which measures coins that are not physically sold, showed that Bitcoin’s hodled supply was underwater. This is the highest level since March 2020.

The accompanying scale shows that the metric has turned red following a fall below zero, i.e. the historical “capitulation zone”.

Chart of Bitcoin NUPL vs. BTC/USD. Source: TradingViewcom. You should do your research before making any investment or trading decision.

https://cointelegraph.com/news/bitcoin-bounces-8-from-lows-amid-warning-btc-price-bottom-shouldn-t-be-like-that