Bitcoin's 25% Rally Not Enough to Confirm New Bull Market

Bitcoin's (BTC) August rally has been significant, rising by 25% over the past month. However, despite this momentum, analysts caution that the cryptocurrency still needs to clear a critical structural hurdle before confirming a new bull market.

According to widely-followed trader Jackis, Bitcoin's recent breakout decisively reclaimed its 200-day moving average, leading to a shift in sentiment from fear to extreme greed. However, Jackis notes that Bitcoin technically remains in a higher-time-frame bear trend and has yet to break above the May high.

Jackis draws parallels between today's setup and Bitcoin's recovery from its 2022 bear-market bottom. In both cases, Bitcoin reclaimed its 200-day moving average before pushing higher to establish a new higher-time-frame uptrend. However, there is a key difference: in 2023, Bitcoin had already broken a major higher-time-frame high before reclaiming the 200-day average.

Jackis suggests that unless Bitcoin clears the May high, the current structure could resemble an inverse version of the 2023 setup, keeping further downside in play. The on-chain and technical indicators are also sending mixed messages, with a weekly bullish divergence resembling the signal accompanying Bitcoin's 2022 bottom.