Cryptocurrency investors continue to enjoy the bullish price action this week following the rise of Bitcoin (BTC), Ether (ETH) and several altcoins on July 20th. along with growth in traditional markets.

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Data from Cryptooshala Markets Pro and trade view shows that the midday Bitcoin bull rally managed to lift the top cryptocurrency to a daily high of $24,281, sparking another round of bullish statements on Crypto Twitter.

1-day BTC/USDT chart. Source: Trading View
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While the weekly gain has helped boost investor sentiment, some analysts are warning traders not to get too far ahead because the market is still giving some alarms to watch out for.

Prepare for the inevitable retreat

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Bitcoin’s rise above $24,000 has officially confirmed the breakout of the previous trading range between $18,000 and $22,500, according to market analyst Caleb Franzen. published the next chart marks the question the market is currently facing.

1-day BTC/USD chart. Source: Twitter

Franzen said,

“Despite this, I believe that the next pullback will be a serious test in this bear market. Will buyers intervene aggressively on a pullback or will they capitulate?

Whale wallets remain dormant

According to research firm Jarvis Labs, one reason to be wary of the current rally is the lack of whale wallet activity.

Bitcoin divergence chart. Source: Jarvis Labs.

The red and orange dots in the BTC divergence chart above represent the buying activity of large and small whale wallets at different points in time. As shown in the highlighted red box, whale activity has been virtually non-existent over the past few months as bitcoin has been on a downward trend.

Jarvis Labs data also showed that larger companies have not yet returned to active buying, and the chart below shows the change in BTC whale stocks.

BTC whale surrender. Source: Jarvis Labs.

Jarvis Labs said,

“We want this pattern of colored dots to start moving up and to the right. If we get it, it will be a positive sign that any rally can have significant momentum.”

Based on the trends identified, Jarvis Labs stated that “it’s hard to be overly excited about a rally that goes beyond liquidity, which is around $28,000” and instead suggested that “at this point, a lower range of $25K seems more likely.” .

Bitcoin could hit $120k in 2023, trader says as BTC price surges 25% in a week

High time frame trend remains bearish

The change in sentiment last week was acknowledged by market analyst and swing trader Il Capo of Crypto, who noted that “the low time frame trend is without a doubt bullish.”

But before going all-in on this draw, Crypto’s Il Capo also published the next chart warns that “the high timeframe trend is still bearish and it’s another lower high.”

12-hour BTC/USD chart. Source: Twitter

Il Capo of Crypto said:

“LTF [low time frame] bearish confirmation below $22k. The main goal remains 15.8-16.2 thousand dollars.”

The total market capitalization of the cryptocurrency is currently $1.062 trillion and the Bitcoin dominance rate is 42.7%.

The views and opinions expressed here are solely those of the author and do not necessarily reflect those of Every investment and trading step involves risk, you should do your own research when making a decision.