Bitcoin price slipped to a key support level after widespread news of Russia’s attack on Ukraine. This decline caused the crypto market to collapse, but the recovery seems to be going well, suggesting that BTC could continue to climb slightly.

Bitcoin is waiting for an up signal

Bitcoin price is down about 23% in almost a week to bottom at $34,337. The weekly support at $34.752 is a major reason for BTC not to slide towards lower areas. The rally prompted BTC to create a daily bar just above the lower border of the $36,398 – $38,895 demand zone.

This crucial close prevented a drop to $30,000 or below and provided solid support for the bulls.

Looking ahead, investors can expect BTC to continue to rally and surpass the recently flipped resistance barrier at $39,481 and the 50-day SMA at $40,417. The Momentum Reversal Indicator (MRI) has flashed a yellow growth arrow indicating that a continuation of the uptrend will help form a green candle on the daily chart and forecasts that BTC is now likely to have one to four green candles will create.

Therefore, market participants can expect bitcoin price to break the weekly resistance barrier at $42,748 where the rally is likely to be halted. However, as the number of buy orders increases, BTC is more likely to continue its rally towards the year open at $46,198, which roughly coincides with the 100-day SMA.

BTC 1-Day Price Chart | Source: TradingView

IntoTheBlock’s Global In/Out of the Money (GIOM) model shows that approximately 4.50 million addresses bought 2.54 million BTC at an average price of $41,190. Technically, this level coincides with a target that BTC can reach, supporting the bullish argument.

Bitcoin GIOM indicator | Source: IntoTheBlock

While the flash crash on Feb. 25 caught many investors by surprise, BTC on-chain trading volume surged to 46.38 billion BTC, well above the 200-day moving average.

A similar price decline has historically coincided with a surge in on-chain trading volume, suggesting that investors may be buying dips (accumulation). Therefore, from a technical perspective, the surge in on-chain volume suggests a continuation of the rally despite the recent crash.

On-chain transaction volume | Source: Cryptoquant

Alternatively, a short-term upside is possible due to the decline in Bitcoin’s financial leverage from an ATH of 0.218 to 0.192. This 12% downtrend shows that the market has become less volatile after the flash crash and the bulls can now take over the market.

Bitcoin Financial Leverage | Source: Cryptoquant

The argument of short-term bullishness is further reinforced as the 30-day pattern of market value to realized value (MVRV) has risen from -6.8% to -2.8% over the past three days. This on-chain metric shows the average profit/loss of investors who bought BTC in the last month.

Despite the recent drop, the 30-day MVRV is now near the zero line, suggesting that many investors could have bought and benefited from the pullback, suggesting a near-term rally is imminent.

Bitcoin’s 30-day MVRV | Source: Cryptoquant

To maintain its bullish outlook, Bitcoin needs to sustain the price above the immediate demand zone, which ranges from $36,398 to $38,895. A daily close below $36,398 will invalidate the demand zone and make a move to weekly support at $34.752 likely.

Failure to hold this area will invalidate the bullish thesis and point to a possible crash into the $29,100 area, accumulating liquidity below this area.

Join CoinCu Telegram to keep track of news: https://t.me/coincunews

Follow CoinCu Youtube Channel | Follow CoinCu Facebook page