The recent stability of Bitcoin’s price is surprising. After lateralizing for about three months around the $27,000 mark, it is now lateralizing just above $30,000.
Indeed, the price range within which it is lateralizing now is even more compressed than the previous one.
Bitcoin: previous phase of price lateralization
After the boom in early 2023 that took the price from under $17,000 to over $25,000, the first long phase of lateralization began on 17 March.
In fact, it ended only on 20 June, and during these three-plus months the price around which it fluctuated was $27,000.
With the exception of the first half of June, during this phase the price of BTC never fell below $26,000. At the same time it never rose above $30,000 except just before mid-April.
Thus this first long lateralization phase of the year has seen the price of Bitcoin fluctuate within a fairly compressed range, namely between $26,000 and $30,000 with only two exceptions.
One upward, around mid-April, and one downward, in early June.
It also often remained between $27,000 and $28,000, which were the reference levels of that phase.
The new lateralization phase
The new lateralization phase began on 21 June, but at higher levels.
Indeed so far in this phase the price has never fallen below $29,500 except for a very brief moment in late June.
The new reference level is between $30,000 and $31,000, although on 6 July it managed for a very brief moment to break above $31,500 thus making new annual highs for 2023.
This is a much more compressed fluctuation band than the previous one, with exceptions so far being very brief and very small.
It is certainly a somewhat higher range, close to the annual highs, but for Bitcoin‘s historical volatility it seems a bit too compressed.
At this point, a breakout from this range, either upward or downward, is expected at any moment.
Bitcoin price: The recovery
This is all part of the recovery process from the lows of the previous bear-market.
Since the current values are perfectly in line with those of the second half of May 2022, that is, after the implosion of the Terra/Luna ecosystem but before the failure of Celsius, it is possible to say that in the course of 2023 the price of Bitcoin has recovered everything it had lost from June 2022 onward.
In particular, while in late May 2022, after the implosion of Terra, the price had fallen precisely in the range of $29,000 to $32,000, the following month it had fallen as low as $18,000, and then plummeted further in November toward $15,500.
That level to date remains the bottom of the last bear-market, which ended in early 2023 with the broad rise first above $16,000 and then also above $18,000.
However, this recovery has not stopped, and in theory may still be ongoing.
For one thing, in mid-January it had already climbed back above the psychological threshold of $20,000. Moreover, by February it had begun to approach $24,000, which is in line with what it reached in August 2022 after the rebound following the collapse due to the Celsius bankruptcy.
However, the rebound in 2023 continued, with the stock exceeding $25,000 in the second half of March and reaching $27,000, which is a figure in line with the bottom of the May 2022 crash.
Then, in late June, it also reached $30,000, with a further leap that definitely made Bitcoin’s value recover everything it had lost from June 2022 onward.
The future
Now the question is: will it be able to recover in the near future even what it lost due to Terra’s implosion?
In early May 2022, Bitcoin’s price was about $38,000, which is a figure that is still a long way off at this time.
It was actually at $40,000 in mid-April 2022, so much so that this is the level many believe it could reach between now and the end of the year.
Right now the main resistance to the upside seems to be that $31,500 that it only managed to break through in early July for a very brief moment.
Once it manages to break through that wall, it is possible that it could even rally back above $32,000, but from there to $40,000 would still be a long way.
First it would have to reach $35,000, a mark that many analysts actually see as attainable.
But after $35,000 there would probably still be $38,000 to pass as well, before we could perhaps finally aim for $40,000.
Moreover, no one can rule out a possible return below $30,000, or perhaps even to that $27,000 that characterized the previous phase of lateralization.
The future on the short or medium/short term therefore is uncertain, while on the medium/long term there is still much optimism circulating in view of next year’s halving.
Source: https://en.cryptonomist.ch/2023/07/13/bitcoin-price-remaining-very-stable/