How to Identify a Bull Market: Signs to Watch for in 2024
In the ever-evolving landscape of cryptocurrency (crypto) trading, the recent surge in Bitcoin’s price has sparked a crucial question among crypto traders: Are we witnessing the dawn of a new bull market cycle?
The market, having endured a bearish phase since the highs of 2021, is now at an exciting crossroads.
IIn December, 2023 the value of Bitcoin (BTC), the world’s largest digital asset, experienced an upswing, reaching a level surpassing $44,000 USD. This milestone represents the highest point since early April 2022, a period preceding the downturn when cryptocurrencies entered a brutal and lengthy bear market. Smaller cryptocurrency tokens have also experienced a breakout such as Ethereum (ETH) and Dogecoin.
The world’s largest digital asset has maintained an impressive momentum since mid-October 2023; there are a few telling factors contributing to the sustained rally.
This blog post aims to guide crypto traders and speculators on how to identify a bull market amidst the changing tides, headline news and buzz. Discover the onset of a bull market as we explore some of the key indicators and recent developments shaping the crypto landscape.
Bitcoin’s recent climb above the $44K USD mark has injected a dose of optimism into the crypto community. Certainly, a significant driving force behind Bitcoin’s surge, outperforming even the Dow Jones Industrial Average and S&P 500, stems from the hopeful outlook regarding regulatory approval for the highly anticipated spot Bitcoin Exchange-Traded Fund (ETF). The potential introduction of such a fund is anticipated to catalyse a fresh wave of interest from both retail and institutional investors in digital assets, providing a supportive boost to cryptocurrency prices.
“Bitcoin broke through resistance at $40K USD,” says Richard Morwood, Founder of VEMA Trader and as can be seen below. “Its next challenge will be breaking above resistance at $46K USD for the bullish trend to continue.”
Earlier this week, the US Federal Reserve decided to keep interest rates steady and hinted at possible rate cuts in 2024. This has added another layer of complexity to the market dynamics.
Crypto traders must remain vigilant and responsive to external macro factors that can influence market sentiment. Understanding the market requires more than just tracking the price movements of Bitcoin alone.
3 Major Signs of Bullish Times
- Higher Highers and Higher Lows: Firstly, since early 2023, Bitcoin has exhibited a bullish market structure, marked by consistent higher highs and higher lows. This upward trend signals a positive shift in sentiment, providing traders with opportunities for profitable engagements. Breaking through the resistance at $40K USD was a significant milestone, and the next challenge lies in surpassing the resistance at $46K USD for the bullish trend to solidify and take hold as can be seen in the figure below.
2. Confidence and sentiment has improved. It is important to note that the concerns related to centralised exchanges have largely dissipated. On December 11, Bitcoin’s exchange trading volume reached a six-month peak despite the recent news of former Binance CEO Changpeng “CZ” Zhao’s guilty plea. Even though December 10 saw the lowest volume for the month, BTC trading surged, exceeding $16.4 billion USD in the subsequent 24 hours. The absence of a significant exodus from Binance, combined with the upswing in exchange trading volume, underscores a resurgence of bullish sentiment.
3. Institutional investors want in. Whilst certain investors may be anticipating increased liquidity following the approval of a spot ETF, institutional investors have already commenced allocating funds to Bitcoin and cryptocurrencies. As reported by CoinShares, institutional investors have injected $1.88 billion USD into the crypto space over the past year, marking the 11th successive week of consistent institutional inflows.
The Role of Automated Trading in Crypto Markets
Contrary to common belief, profit-making in crypto trading is not confined to rising asset values. Leveraging trading strategies can enable traders to capitalise on market movements in either direction. This brings us to the relevance of automated trading tools, such as VEMA Trader, in navigating the complexities of the crypto market. Discover the best automated trading platform in Australia VEMA Trader today.
Amidst the unpredictability of the crypto markets, it is essential for traders to have a reliable tool that adapts to market conditions seamlessly. VEMA Trader stands out as a beacon for crypto traders, offering customisable entry conditions that empower users to be ready for market shifts, be it bullish or bearish.
VEMA Trader’s strength lies in its ability to analyse market data and execute trades based on predefined conditions. By providing users with the flexibility to set custom entry parameters, VEMA Trader ensures that traders are prepared to enter the market decisively, regardless of the prevailing trend. This adaptability is crucial in a market that can change direction swiftly.
As the crypto markets navigate the delicate balance between bullish and bearish territories, it becomes imperative for traders to equip themselves with tools that offer versatility and responsiveness.
Regardless of the market direction, traders can position themselves for success by signing up for VEMA Trader.
Sign up to VEMA Trader today and experience a new level of confidence in your crypto trading journey. Trading the markets has never been simpler – be ready for whatever direction the price takes.