Bitcoin is displaying signs of strength and resilience, indicating a potential upward continuation, according to Michaël van de Poppe, the founder and CEO of trading firm Eight. Key trend lines have been preserved, contributing to the positive outlook.
On May 15, Bitcoin reached five-day highs, continuing its rebound following the Wall Street open. BTC/USD on Bitstamp reached $27,666 and held its strength on hourly timeframes, with a weekly close just below the $27,000 level.
Amidst a tight range for US equities, market analysts sought cues for the next market direction. Van de Poppe expressed optimism, highlighting Bitcoin’s upward break and test of $27,600 as positive signs. He noted that the cryptocurrency is holding the 200-week moving average and exponential moving average on the weekly timeframe, suggesting a potential continuation towards the $38,000-42,000 range.
Other traders also shared a positive sentiment, with popular trader Kaleo viewing the recent breakdown and subsequent reclaim as a favorable setup for a potential move back to range highs, emphasizing that $40K still remains an attractive target.
Analyzing the BTC/USD Binance order book, Material Indicators reported a lack of volatility at the moment. Trader Skew mentioned that Binance spot buyers are largely influencing the market, while Coinbase spot buyers led the recent uptick.
In terms of the US dollar, attention continued to focus on its strength after a week of solid gains. However, the new week started with a different scenario, as the crypto market displayed strength while the US Dollar Index (DXY) experienced a slight downturn. This inverse correlation between cryptocurrencies and the dollar was noted by traders, suggesting that a breather for the dollar could contribute to the recovery of crypto assets.
While the strength of the US dollar could still pose pressure on cryptocurrencies if the DXY sees a “very strong” close, overall market indicators and analyst sentiment point towards positive signs for Bitcoin and a potential attainment of the $40,000 price target.
