The newest is Blackrock, announcing interest in trading in Bitcoin futures while Grayscale continues to scoop up BTC at an accelerating rate.
But after a massive surge, the asset's price must come down for some tests of service as investors take profit. This is the gorgeous cyclical nature of supply and demand.
BTC/USD is presently in a corrective phase as Bitcoin's rally became overextended above $40,000. The primary question is how much the correction will go from here or whether the $30,000 level will be powerful enough to fend off the bears.
$30,000 should hold to Keep bullish
The daily chart for Bitcoin shows a tremendous rally in recent months. However, some flaws are emerging since the current high, and the cost corrected by roughly 30 percent.
One of these weaknesses is the continuing lower highs since the recent peak high at $42,000. These reduced extremities are confluent with poorer bounces in the service area.
In cases like this, the 30,000 area has held earlier. However, to the issue of the bulls, the bounces from this area are getting weaker.
If the $30,000 area doesn't hold, a further correction toward $24,000 becomes probable, which would signify a retrace of 40 percent because the recent highs.
Corrections are quite common in a bull market
This weekly chart indicates the former bull cycle in 2015 to 2017 highlighting some corrective periods.
As long as the price of Bitcoin sustains over this 21-Week MA, the bull cycle is continuing.
Dealers and investors should know about the truth that nothing goes up in a direct line. Corrections are organic and healthy for the markets to happen and can be utilized as an chance to buy the dip.
The second important thing to notice in this chart is that the magnitude of these corrections. During the former bull cycle, there have been multiple corrections of 30-40%which were quickly purchased before the bull cycle lasted.
It's worth noting that altcoins might see more drawback as they are not as liquid and therefore, always more volatile than Bitcoin.
Hence, the best end of this correction could happen toward the 21-week MA. This index is currently moving around the previous all-time high at $20,000. But, it is a lagging indicator, and corrections don't occur within a week, meaning the 21-week MA would continue to go even higher in the meantime.
1 possible scenario is that the 21-week MA moving around the 24,000-26,000 within a couple of weeks from today. Such a correction would likewise be 30-40%.
Total market cap will retest past all-time high
The total market capitalization graph is a fantastic chart to watch during corrections.
While the likelihood that Bitcoin will retest its previous all-time high is very small. On the other hand, the chances that the entire market capitalization will test its preceding all-time high is important.
This retest would put the 21-week MA of the entire market cap graph around the degree of 750 billion, an important confluence with the 2018 all-time large. Therefore, investors and traders must be seeing the 750 billion zone as crucial support for a possible bounce in the cryptocurrency market.
The perspectives and opinions expressed here are solely those of the writer and don't necessarily reflect the views of Cointelegraph. Every single investment and trading movement involves danger. You should run your own research when making a determination.