Key Points
- Bitcoin has entered Phase E of the Wyckoff Accumulation model, indicating a possible strong upward continuation.
- The declining number of Exchange Withdrawing Transactions suggests selling pressure may be decreasing, potentially fueling the current rally.
Bitcoin has officially moved into Phase E of the Wyckoff Accumulation model. This phase is typically marked by a breakout and strong upward continuation.
A key technical confirmation of this phase was observed on May 24th, when the 50-day Moving Average (MA) crossed over the 200-day MA. This ‘golden cross’ on the daily chart is considered a bullish long-term signal, often indicating a shift in sentiment.
Market Predictions and Influences
With this shift, many traders are now targeting the $125K mark, the first major resistance within this markup phase. However, the question remains as to what will happen beyond this point.
According to one market analyst, the next cycle for Bitcoin could either be a distribution phase or a re-accumulation phase. The most likely scenario, in his view, is re-accumulation, especially given the upcoming vote on key crypto legislation in the U.S. Senate.
While regulatory events can cause volatility, they may also boost institutional confidence, particularly if legal clarity around digital asset classifications emerges.
On-chain Metrics and Market Supply
On-chain metrics are adding momentum to the current rally. The decreasing number of Exchange Withdrawing Transactions, which track how often Bitcoin is moved to private wallets, indicates that selling pressure may be reducing.
This decrease in selling pressure could act as a subtle bullish driver, reducing overhead resistance and boosting price momentum. The analyst’s projection of a distribution move near $260K by August or September aligns with this pattern, assuming market supply remains constrained.
The fate of Bitcoin in the near future, whether it undergoes re-accumulation or distribution, will depend on investor sentiment and the outcome of pending Bitcoin legislation.
