Can Bitcoin Find Its Essential Way Back To $20,000?

Key Points:

• Large Bitcoin accumulations in recent weeks have had a significant impact on the coin’s comeback above $18,000.
• Fear had subsided in the larger market, but a $20,000 prediction appeared to be a difficult aim in the immediate term.

Bears may have been taken aback as Bitcoin BTC defied expectations and soared beyond $18,000 to continue its strong start to the year.

According to Glassnode’s statistics, the achievement would have been impossible without the string of significant accumulations since BTC traded around $16,500. According to the on-chain analytic tool, the acquisition continued until the price hit $18,200.

This has assisted in converting 13% of the coin’s circulating supply into profits. It is worth noting that the indicator represents the percentage of total supply kept in profit. According to supply in profit data, the 10.3% surge assured that 60.5% of investors who purchased about $16,500 made a profit.

The supply in profit percentage was on track to produce a negative divergence before the positive advance. This was in contrast to the 48% loss seen between November 2022 and January 1, 2023.

Following the development, Bitcoin’s social metrics reached new heights. According to Santiment, social dominance decreased to 8.77% on January 6 but had risen to 14.74% at the time of publication.

Similarly, the social volume followed the pattern, rising to 8706. However, at the time of writing, the volume had dropped to 2379. This signified that BTC has captured a sizable portion of the crypto community’s attention. However, the drop in volume indicated a diminished hunt for the currency.

The move was followed by a further retreat from the market’s severe fear side, as shown by the Bitcoin fear and greed index. At the time of publication, the index had moved somewhat closer to the neutral point of 30.

Furthermore, Bitcoin has the potential to push the rest of the market higher. Unfortunately, this was to the detriment of shorts, who accounted for a major portion of the liquidations over the past 24 hours.

Can BTC hit $20,000?

Despite the pullback to $18,100, the Directional Movement Index (DMI) predicted that BTC may increase further. This was due to the positive DMI (blue) being so high at 48.09.

However, according to the trend of the Average Directional Index, a push toward $20,000 may be difficult to achieve (ADX). If the ADX (pink) was at 25 or above, it would have supported the probability. Instead, it remained at 22.39.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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