The Ultimate Launchpad? Why Bitcoin’s Current Price Action Foreshadows 2017 and 2020 Bull Runs

Bitcoin is testing a historic plateau that is consistent with previous parabolic rallies.

Bitcoin briefly rose above $71,000 early Friday, as it rebounded slightly from earlier weakness. This comes as authorities work to deal with oil supply disruptions in the Strait of Hormuz and restore market stability.

Among these developments, Bitcoin is approaching a support line that has long “monitored” its price action since 2017.

Support Down

According to data shared by crypto analyst Ali Martinez, historically, each previous test of this level preceded major rallies, including gains of 963% in 2017, 261% in 2018, 1,126% following the 2020 COVID-19 market crash, and 660% after the 2022 FTX crash.

The flagship cryptocurrency is currently approaching this support area between $60,000 and $56,000. Martinez added,

“If this floor is solid, we’re not just looking at a bounce. We’re really looking at the launching pad for the next big bull cycle.”

Additionally, TD Sequential has flashed a buy signal on Bitcoin, which means that recent declines may lose momentum. Based on this setup, the asset can be set to re-bind its current levels.

Separate data shows that Bitcoin is showing a huge volatility as the number of whale wallets holding at least 100 BTC increased to 753 in the last three months. At the same time, the Bitcoin market value decreased by 20%, which shows the accumulation of large owners despite the drop in prices.

Weak Confidence

But a deeper look at the market structure reveals that the recent move has not been supported by strong confidence in all sectors. Bitcoin has taken off a huge supply rally, pushing the commodity to a low of around $82,000. This suggests reduced resistance in the short term. However, the outbreak has not yet ensured widespread structural change.

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About 60% of the Bitcoin supply is currently profitable, less than the usual 75% seen in the categories of strong bulls, while short-term holders saw profits at a rate of $ 18.4 million per hour, indicating continued selling pressure. While spot demand has improved, supported by new inflows into the US spot Bitcoin ETF and strong swap activity, derivatives data shows limited confidence.

CME futures open interest remains low, and negative funding levels indicate continued short standing, which has fueled the rally with short coverage. Options markets are showing declining volatility and rising call interest rates, pointing to a more balanced outlook. Glassnode noted that holding above $70,000 while taking profits could support a move to $78,000 and possibly $82,000, although further increases may depend on strong cash flow and increased profits.