Since early 2022, Bitcoin has been in a ranging phase, resulting in two crucial supply and demand levels. There seems to be a lot of demand in the form of bids and stop-losses above $45K, making it a significant level to watch.
Technical analysis
The daily chart:
As seen on the daily chart, the price was supported by the significant support level at $37,000 which led to a break of the RSI resistance trendline and is now attempting the 100-day moving average. This is significant resistance on Bitcoin’s route to the top of the range. The $45,000 supply zone is inevitable if the moving average is breached.
The 4-Hour Chart:
On the 4-hour time frame, the $37K support zone has served as a significant support level for Bitcoin, preventing it from plummeting to lower levels. On the other hand, BTC has been moving within a clear ascending channel (white trendlines) and has now broken the channel’s mid trendline.
Additionally, the price is near its previous pivot and below a short-term resistance level around $42,000, which increases the chances of a double-top pattern emerging. If the threshold is breached, Bitcoin will face no hurdles at the $45,000 supply zone.
On-chain Analysis
Bitcoin: Net Unrealized Profit/Loss (NUPL)
Analyzing the unrealized profits and losses of the market participants has proven to be helpful to determine the price tops and bottoms, and the NUPL metric is the most common indicator used for this goal. The chart demonstrates that the amount of losses has reached and even went below last year’s $28K bottom. However, it is nowhere near the previous bear market bottoms.
If a bear market scenario is assumed, the market has not yet gone through the final phase of capitulation, which occurs at the all-time low. During this capitulation event, even the most patient retail investors start selling in a panic, and the smart money arrives to buy these coins at a huge discount. On the other hand, while a bull market is still in play, current NUPL levels have historically coincided with mid-term lows.
