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- While uncertainty surrounds the direction of Bitcoin and Ethereum prices, fundamental factors such as ETFs, halving events, macro conditions, etc. provide confidence for bullish trends ahead.
- Technical indicators like the Supertrend, moving average crossovers, and the Aroon indicator suggest that both BTC and ETH are currently in bullish trends.
The two largest cryptocurrencies. – Bitcoin and Ethereum – have been hovering in a very tight range while the rest of the altcoins have been showing strong momentum.
Numerous traders and investors are pondering whether the ‘bull run’ that propelled Bitcoin (BTC) to unprecedented highs and resulted in substantial price surges for various cryptocurrencies like Ether (ETH) throughout 2024 has concluded. Ever since the Bitcoin halving event, the BTC price has been hovering in the range of $65,000-$72,000.
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Uncertainty also surrounds Ethereum, the cryptocurrency associated with the smart contract-focused network established by Vitalik Buterin. Despite experiencing significant price appreciation, it struggles to decisively breach the psychological threshold of $4,000 and remains within a lateralization zone. Currently, the Ether (ETH) price has been consolidating around the $3,800 level.
From a fundamental analysis perspective, there are several compelling reasons to anticipate the continuation of the bullish trend for cryptocurrencies throughout the rest of 2024 and possibly into part of 2025.
Highlighted among these factors are the approval of spot ETFs in the United States, the “halving effect,” macroeconomic considerations, and the ongoing technological advancements in Bitcoin. Furthermore, technical indicators are also available to validate the current active bullish trend. Let’s take a look at some of such indicators.
The Supertrend Indicator
The Supertrend indicator utilizes a multi-factor analysis to determine whether the trend of a financial asset is bullish or bearish. Based on the Average True Range (ATR), the Supertrend is a trend indicator that combines trend and volatility detection into a single line calculation.
The graph below illustrates how the Supertrend has generated buy signals (which remain valid) for two cryptocurrency assets. For Bitcoin, the Supertrend will continue to identify the asset as being in an uptrend as long as daily candles close above $62,400. Similarly, for ether, the bullish trend would be invalidated if a daily candle closes below $3,360.
The Bullish Crossover
Using moving average crossovers is a widely employed technique in technical analysis to pinpoint shifts in the trend of a financial asset. This method involves utilizing two moving averages with different periods: a short-term moving average (e.g., 10 periods) and a long-term moving average (e.g., 20 periods).
When the short-term moving average intersects above the long-term moving average, it signals the onset of an uptrend for the financial asset. Conversely, when the short-term moving average crosses below the long-term moving average, it suggests the emergence of a bearish trend.
Presently, for both Bitcoin and ether, employing the widely used combination of the 10-day and 20-day moving averages reveals a bullish trend.
Aroon Indicator
Although not one of the most widely recognized indicators, Aroon demonstrates remarkable effectiveness. Historically, it has proven valuable in predicting significant bullish movements for both BTC and ETH, offering reliable entry and profit-taking signals.
The Aroon indicator serves as a technical tool for identifying trend shifts and gauging their strength in an asset’s price. Essentially, it assesses the time intervals between highs and lows over a specified period.
When the orange line surpasses the blue line, it indicates an uptrend, whereas if the blue line dominates the orange line, a bearish trend is signaled. Notably, both the Aroon indicator and the simple moving average crossover.
