Bitcoin (BTC) reached a price of $65,000 during the early Asian trading session on May 6, thanks to the 50-day exponential moving average (EMA) providing immediate support. Data from Cointelegraph Markets Pro and TradingView showed that the BTC/USD pair rebounded from lows of $63,340 on May 6, rising 3.45% to an intraday high of $65,523.
BTC is now approximately 15% higher than its two-month low of $56,500, which was reached last week on May 1, as concerns over the stagflation of the U.S. economy caused investors to adopt a risk-off approach. Bitcoin’s recovery resulted in a bullish weekly candle and a return to a “more neutral state” for Bitcoin funding rates, according to market intelligence platform DecenTrader.
Data from Coinglass confirms DecenTrader’s observations, showing that Bitcoin’s funding rates on exchanges have now returned to a neutral state after turning negative last week. Negative funding rates are typically seen as bearish indicators, so a neutral funding rate suggests a reset in trader positions and a mixed sentiment in the market.
However, if Bitcoin were to decline from its current levels, key support levels would come into play, including the demand level of $57,000 to $64,000, which is supported by the 50-day EMA. Independent trader Ali Martinez considers this range a “prime buy zone” for BTC.
Martinez also shared a chart from Glassnode, which shows that Bitcoin’s recent drawdown caused the MVRV ratio to drop below its 90-day moving average. According to Martinez, when the MVRV dips below the 90-day average, it signals a buying opportunity. Despite Bitcoin’s recent surge above $60,000, the Bitcoin MVRV Momentum still satisfies this condition, making it an ideal entry point for the asset.
In response to last week’s market drawdown, Bitcoin whales took advantage of the “prime buy zone” and purchased more BTC at discounted prices, according to on-chain data provider IntoTheBlock. However, the accumulation by whales has been dwindling, suggesting that large investors may have less appetite to buy the dip. Nevertheless, continued accumulation by large investors signals bullish sentiment among this group.
It is important to note that this article does not provide investment advice or recommendations. Readers should conduct their own research and exercise caution when making investment and trading decisions.