Bitcoin price hits $24K, but analysts say on-chain data points to an ‘inevitable’ pullback

Investors in cryptocurrency continue to benefit from this week’s bullish price movement after Bitcoin (BTC), Ether(ETH) and a few altcoins rallied July 20 along with gains in traditional markets.

Data from TradingView and Cointelegraph Markets Pro shows that the top crypto reached a daily high at $24,281 during a midday rally of Bitcoin bulls. This sparked a new round bullish proclamations on Crypto Twitter.

BTC/USDT 1-day chart. Source: TradingView

The market continues to provide some warning signs that are worth noting, according to analysts.

Be prepared for an inevitable pullback

According to Caleb Franzen (market analyst), Bitcoin’s rise above $24,000 was officially confirmed as a break from the $18,000-$22,500 trading range. He posted the following chart, which highlights the question that the market is now facing.

BTC/USD 1-day chart. Source: Twitter

Franzen said,

“Regardless, I believe that the next pullback in this bear market will be a significant test. Will buyers react aggressively to a pullback, or will they capitulate?

Whale wallets are still dormant

According to Jarvis Labs, an on-chain research firm Jarvis Labs, one reason to be cautious about the rally’s ability sustain itself is the absence of whale wallet activity.

Bitcoin divergence chart. Source: Jarvis Labs

The BTC divergence chart shows that large and small whale wallets have bought at different times. The red highlighted box shows that whale activity has been virtually non-existent in recent months, as Bitcoin trended downward.

Jarvis Labs data also indicated that larger entities are yet to buy again, and the chart below shows how BTC whale holdings have changed.

BTC whale holding exchange. Source: Jarvis Labs

Jarvis Labs stated,

“We want to see the pattern of colored dots move up and to one side. It will be a sign that rallies could have substantial momentum if we can get it.

Jarvis Labs, based on the identified trends, stated that it was difficult to get too excited about an increase in liquidity beyond $28,000 and suggested that the lower band of $25K seemed most likely.

Related: Bitcoin could hit $120K by 2023, according to a trader. BTC price gains 25% within a week

Bearishness is still evident in the high-time frame.

Swing trader il Capo, a market analyst, and crypto-trader, acknowledged the positive shift in sentiment over the last week. He noted that the “Low Timeframe Trend is Bullish, without doubt about it.”

However, before jumping in to this rally, il Capo Crypto posted the following chart: “High timeframe trend is still bearish. This is another lower high.”

BTC/USD 12-hour chart. Source: Twitter

Il Capo of Crypto,

“Ltf [low-time frame] bearish confirmation is less than $22K. The main target is $15.8K-16.2K

The total cryptocurrency market is now worth $1.062 trillion. Bitcoin’s dominance rate at 42.7%.

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Eileen Wilson

Eileen Wilson –Technology and Energy My Name is Eileen Wilson with more than 5 years of experience in the Stock market industry, I am energetic about Technology news, started my career as an author then, later climbing my way up towards success into senior positions. I can consider myself as the backbone behind the success and growth of topmagazinewire.com with a dream to expand the reach out of the industry on a global scale. I am also a contributor and an editor of the Technology and Energy category. I experienced a critical analysis of companies and extracted the most noteworthy information for our vibrant investor network.

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