Renowned cryptocurrency analyst TechDev suggests that Bitcoin (BTC) is currently caught in a bear trap, a strategic move to weed out weak investors before experiencing a significant price surge. The analyst, who remains anonymous under the pseudonym TechDev, shares a Bitcoin chart on the popular social media platform X, indicating that BTC is displaying similar price patterns to its pre-parabolic movement in 2017, following a period of approximately 1,200 days of accumulation.
TechDev’s chart also incorporates the net unrealized profit and loss (NUPL) metric, which assesses the overall market sentiment by tracking the unrealized gains and losses of all circulating coins. According to the chart, the analyst identifies four distinct stages in Bitcoin’s bullish cycle: hope, optimism, belief, and euphoria. TechDev suggests that Bitcoin is currently in the belief stage, where the most significant price surges typically occur.
The analyst further presents another chart illustrating what he believes are the 16 different stages of the Bitcoin market cycle. According to TechDev, BTC is presently in the “bear trap” phase, characterized by a correction driven by concerns of overvaluation and premature fears that the market cycle has concluded. This phase occurs just before a substantial expansion into the euphoria zone.
TechDev also examines two indicators that he claims have proven reliable in predicting the beginning and end of previous Bitcoin blow-off tops: the relative strength index (RSI) and the Chaiken Money Flow (CMF) index. The RSI serves as a momentum indicator, while the CMF is a volume-weighted average of accumulation and distribution over a specific timeframe. In TechDev’s own words, “RSI calls the tops. CMF calls the blow-offs.”
Upon analyzing TechDev’s chart, it appears that the RSI has not yet reached a descending resistance line, which historically signifies the end of bull markets in previous cycles. Conversely, the CMF has recently surpassed a resistance level that has previously indicated the beginning of significant Bitcoin rallies.
As of the time of writing, Bitcoin is trading at $55,282.
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