Bitcoin (BTC) Detects Supertrend Buy Signal...Will a 700% Surge Be Replicated?

▲ Bitcoin (BTC) Rise/AI-Generated Image

Bitcoin (BTC) has triggered a strong buy signal on a key trend indicator for the first time in three years, raising expectations for the resumption of a long-term bull market.

According to crypto media outlet The Crypto Basic on September 23 (local time), the Supertrend indicator, which analyzes trend direction by combining virtual asset prices and volatility, has turned into a green buy signal again around the $84,000 mark. Virtual asset commentary group Rand Group pointed out that when the previous buy signal occurred in early 2023, Bitcoin was trading around $16,000. Since then, the indicator remained green for about three years, and Bitcoin experienced an explosive rally of approximately 700% until it broke past the $120,000 mark.

Bitcoin dropped to $57,700 in July, marking a cyclical low, but has since rebounded 51% over the past two months, recovering to the $84,000 level. This green turn of the Supertrend indicator is seen as a technical turning point, signaling the end of the downward correction phase that began above $100,000 and a shift in market sentiment back to bullish. However, analysts noted that there is no guarantee that the past 700% surge will be replicated identically, and it should be interpreted as an indicator signaling an upward shift in trend.

On-chain and market analysis indicators also lend weight to the possibility of the bear market ending. Ki Young Ju, founder of CryptoQuant, analyzed Bitcoin's return above its 365-day moving average of $83,000 as "the end of the bear market traders have been waiting for and a signal for institutional FOMO to re-enter." Market analyst Ted Pillow also diagnosed that Bitcoin has already bottomed out, based on its higher weekly highs and crossing above the 50-week moving average.

Bitcoin closed its weekly price on September 20 at $81,159, settling above the 50-week moving average for the first time in 45 weeks. This is 24% higher than the 200-week moving average. The market points to the $88,761 level, where the 2-year moving average is located, as a key technical watershed that must be defended to secure strong upward momentum in the future.

[Article Key Summary]

-The Bitcoin Supertrend indicator turned into a green buy signal at $84,000, showing a technical pattern similar to the previous 700% rally.

-Ki Young Ju, founder of CryptoQuant, diagnosed the breakout above the 365-day moving average as a key signal for the end of the bear market and the re-entry of institutional funds.

-Bitcoin, having closed its weekly candle above the 50-week moving average for the first time in 45 weeks, is expected to see the breakthrough of the $88,761 resistance level as a watershed for a further rally.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*