Bitcoin Price News: Historical Buy Signal Still in Play as BTC Recaptures $60K

Bitcoin (BTC) has jumped by 3% in the past 24 hours and recaptured the $60,000 level after briefly dropping below that mark on Sunday.

Buying pressure at this particular level, which is the token’s current cycle low, was particularly high, evidencing its technical relevance.

Surprisingly, a major short squeeze happened as BTC bounced back. Data from CoinGlass shows that nearly $540 million in short positions were blown up on Sunday as a result of the move.

This was the highest single-day squeeze since April 16, and could indicate a successful bear trap. If that’s the case, that may set the stage for a strong recovery during this week to at least $70,000.

Investors Withdraw Billions from Bitcoin ETFs in Just 8 Days

Market sentiment remains heavily depressed as a result of last week’s drop. The Crypto Fear and Greed Index plummeted to 15, indicating that investors are in ‘Extreme Fear.’

Moreover, we have seen a big spike in net outflows from Bitcoin-linked exchange-traded funds (ETFs), reflecting investors’ bearish attitude toward the token.

On Thursday, a long-dated streak of negative outflows was broken as $3.2 million flowed to these vehicles. However, investors resumed their withdrawals on Friday, taking out another $325 million.

Since the beginning of June, data from The Block shows that total assets under management (AUM) have dropped from $113.1 billion to $95.8 billion, meaning a 15% decline in just 8 days.

Weekly Buy Signal Still in Play As Bitcoin Bounces Off $60,000

We have been tracking for weeks a buy signal in the weekly chart that has yielded attractive returns in the past.

This signal triggered as the Relative Stregnth Index (RSI) dropped below 30 in this higher time frame.

The win ratio for this signal is 100% for buy-and-hold investors. However, for traders, if the previous low was used as the stop price, that ratio drops to 66%. That’s not bad either, though.

We have not yet broken below BTC’s $60,000 cycle low. Hence, this signal is still valid, and this weekend’s strong recovery, paired with above-average short liquidations, could indicate that the signal is unfolding as expected.

If BTC starts rallying and climbs above $70,000 at some point, we may be witnessing the beginning of the top crypto’s next bull market, based on this historical pattern.

In the past, this signal has led to new all-time highs for Bitcoin. Our target, alongside those of some top investment banks, is $200,000 in the long term.

No Buy Signal Yet But BTC’s Support Bounce Seems Quite Promising

Looking at the daily chart, we can see a clear bounce off $60,000 that was accompanied by above-average trading volumes. The Relative Strength Index (RSI) in this lower time frame is coming out of oversold territory, which increases the odds of a technical bounce.

Our two targets in this case would be a retest of the token’s former trend line support, followed by the 200-day exponential moving average (EMA) if BTC manages to keep rising.

Our signals system flagged that trend line breakout with a clear sell signal that yielded positive results. We would love to see a buy signal after this support bounce to confirm that institutional volumes are backing the move.

For now, that signal is absent. Stay tuned for further updates this week, as we might be on the verge of a major turnaround for the crypto market.