Bitcoin (BTC) closed the month of February with its fifth monthly loss, marking only the second time in its history that the leading cryptocurrency has posted five candles in a row on the monthly chart.
Increased call options
The latest decline saw Bitcoin fall to around $63,000 last Saturday, marking a nearly 15% drop since February. However, the beginning of March brought a modest return.
The asset opened the first week of the month at $68,600, gaining a little more than 3% as it tries to recover the $70,000 level, which has consistently acted as a significant resistance barrier over the past few weeks.
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Despite ongoing geopolitical tensions in the Middle East, market participants appear relatively calm. Markus Thielen, head of 10x Research, said traders do not foresee the Iran conflict causing major economic disruption.
In a memo to Bloomberg, Thielen said Demand for Bitcoin bullish call options has increased in recent days, suggesting that some investors have a potential rally ahead of the upcoming Federal Reserve (Fed) meeting.
The current setup also restarted historical comparisons. The last time Bitcoin experienced a similar series of red monthly candles was during the year Bear market 2018-2019.
During that previous period, the asset posted six consecutive monthly losses. What followed was a sudden change: five straight green candles and a 308% increase, with Bitcoin rising from around $3,400 to $14,000.
Market watchers are divided about the Bitcoin Outlook
Market expert Ash Crypto recently is emphasized this pattern on social media suggests that if history repeats itself, Bitcoin may be nearing a cyclical bottom after its fifth red month.
A comparable advance of 300% from current trading levels means a potential move to $272,000. However, such a prediction depends on whether the recent lows are ultimately the end of this correction.
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Not all analysts are convinced that the downside is over. The technical analyst has Virtual Bacon is stated further relapses can be expected before a sustained recovery.
He identified $65,000, the previous high, as the first key level, noting that the price has already visited this area. For those who subscribe to the thesis that previous highs often turn into support, he suggested that the opportunity is already there.
A deeper pullback, in his opinion, could take Bitcoin to $58,000, where it is 200-week simple moving average (SMA) is currently sitting. Historically, this long-term indicator has played an important role in determining market levels.
It helped the sharp decline in the fall of COVID-19 in 2020, which marked an absolute low in 2018, and was repeatedly tested in 2015, and never closed every week.
Because of this record, the 200-week moving average is widely regarded as one of the most reliable long-term rallying zones in Bitcoin history.
Featured image from OpenArt, chart from TradingView.com
