Kevin Swenson, a popular crypto analyst and trader, has recently stated that Bitcoin (BTC), the largest cryptocurrency by market capitalization, has just signaled an extremely and historically reliable bottom indicator.
In a new strategy session shared on YouTube, Swenson told his teeming subscribers that the weekly volume signature of Bitcoin on Coinbase is suggesting a possible trend reversal for the flagship digital currency.
Kevin Swenson noted:
“The thing that’s catching everybody’s eye right now is of course the Coinbase weekly volume, and these weekly volume signatures have been extremely reliable at calling major market bottoms and major market tops.
“Just like the 2017 bull market peak, there was a volume signature there. The $6,000 low point volume signature right there as well. That $3,000 low in 2018, right around that area, major volume spike right there. The 2019 $14,000 top, major volume signature associated with that top. The Covid crash, major volume signature right there. And also our $30,000 bottom right here in 2021 major volume signature there.
“If you’re looking to the right, we can see that we are once again getting that type of volume levels…
Although the weekly volume signature on Coinbase has proven to be a reliable bottom indicator during previous bear markets, the analyst opined that this time could be different due to Bitcoin’s correlation with the price action of the US stock market.
“Now that we’re seeing this volume signature on Bitcoin exceeding all previous levels on the Coinbase chart, if the stock market plays out a rally from this point, at least this will be the bottom for that temporary rally wherever that may lead us to.
“At the very least, it will probably hold as a bottom for quite some time. If the S&P 500 does start to come back down and test lower at a later date, then it’s possible that this is not a perfect signal and that more likely we may test just slightly than it, maybe towards $20,000, $22,000, or the 200-week simple moving average.”