Bitcoin broke well above $ 20,000 this week, indicating that the bull market is real and that the cryptocurrency is likely to become parabolic in the very near term if it has not already done so.
The cut was supported by the highest “Real Volume” since the peak of June 2019. High volume during a cut-out indicates that the surge is real, and is backed by buyers. However, because “Real Volume” in the past has only reached such points during reversals, it could also be an ominous sign that a correction is coming. Which is it, and what else can volume tell us about the cryptocurrency currently trending?
Real Bitcoin Volume Reaching Highest Summit Since June 2019 High
Bitcoin this week broke above $ 20,000 and in a flash found itself at a peak of $ 23,750 before taking a breather. An analysis of the key resistance level and a $ 20,000 clean clearance signaled that the crypto bull market was back, and a surge in volume arrived to support the move.
The powerful burst of buying and selling with plenty of BTC exchange hands caused a climax in Bitcoin’s “Real Volume” that is the highest since the June 2019 peak.
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Back then, the cryptocurrency increased to $ 13,800. The next highest level of “Real Volume” came during the fall of Black Thursday, when Bitcoin once again fell below $ 4,000.
From the highest of $ 13,800 to the lowest of $ 3,850 there was roughly a $ 9,950 fall. From the low of $ 3,850 in 2020 to the current peak of $ 23,750, there was a swing of $ 19,900. Interestingly, that’s exactly double the length of the $ 9,950 discount for re-testing Bear
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But that’s not the only correlation. Each of these large swings witnessed a significant surge in Bitcoin’s “Real Volume” and so far, all cases except the current rally resulted in a reversal immediately thereafter.
“Real Volume” is a tool developed by Bitcoin expert Charles Edwards designed to filter all “fake” volume on websites such as CoinMarketCap. Edwards also created the Hash Ribbons and other basic tools.
Bitcoin Real Volume reached the highest since 2019's peak | Source: BTCUSD on TradingView.com
Crypto turned to Max: What a Real Volume A VPVR Could Show
Could this “Real Volume” hinge be a reversal disguised as a cut-out? Such fractures also support fractures, so the correlation is not conclusive.
But volume can be an extremely useful technical indicator, on which almost every trader and analyst worth its salt depends. Volume precedes price, as the saying goes.
Another way to look at volume is by using the Volume Profile Visible Range (VPVR). The description of the instrument explains that it “displays trading activity over a given period and plots a histogram on the chart that reveals dominant and significant volume levels based on volume and essentially gives a clear indication of Supply or the demand for a certain price rather than volume in a given period. ”
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The most significant piece of the volume profile puzzle is called a “control point,” which represents the price level at which the most execution occurred, as measured by volume within a given period. The control point from 2019 to today, lies at around $ 9,200 where a CME gap is waiting to be filled.
This level is particularly important, as it outlines where the underlying supply and demand battle point occurred, and where the equilibrium holds Bitcoin in and Bear
A bear market “href =” https://www.newsbtc.com/dictionary/bear/ “data-wpel-link =” insider “> was finally broken.
It is important to note, that it is not uncommon for assets to re-test a large control point before moving higher. The control point changes depending on the time frame, and when zooming out further to take much of the Bear
“href =” https://www.newsbtc.com/dictionary/bear/ “data-wpel-link =” insider “> taking the market into account, the Black Thursday sale was actually a completely predictable reboot of the “A development point of management,” according to the VPVR indicator.
The Black Thursday collapse was stopped at the point of control | Source: BTCUSD on TradingView.com
Re-testing another control point could take the cryptocurrency back to a re-test of under $ 10,000 that would be shocking to anyone who saw this year’s rally, and act as a bit of a shakeup.
But it could also be healthy, and like Black Thursday, be a signal to the market that it’s time to leave that control point behind, and let another unfold. With very little price action above $ 10,000 and the control point tapped for the last time, price discovery can begin in full swing.
Featured image from Deposit Photos, Charts from TradingView.com