Bitcoin (CRYPTO: BTC) is hovering around the $29,000 mark on Wednesday, fueled by the rise in investors’ optimism following the announcement of crypto initiatives by several financial services institutions.
What Happened: A closer look at a technical analysis methodology called the Wyckoff Method may have foreseen this change in trend and narrative.
Crypto Analyst ‘Tony The Bull’ pointed out this first on Twitter.
In the 1930s, Richard Wyckoff founded a technical analysis methodology known as the Wyckoff Method, which focuses on understanding market behavior. Unlike other methodologies, Wyckoff believed that every retail investor or trader should think of the market as being controlled by a “Composite Man.”
The Composite Man, according to Wyckoff, is the “smart money” in the crypto market. These are simply large actors that accumulate assets when prices are low. Once these larger players have built up a position, the resulting markup in prices makes their presence known.
“In Wyckoff’s theory, the Composite Man attracts the public to buy a ‘stock’ in which he has accumulated a sizeable line of shares… in effect advertising his stock by creating the appearance of a broad market,” tweeted the analyst.
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Why It Matters: Interestingly, this sudden uptick in Bitcoin’s price is following a textbook Wyckoff accumulation pattern, according to the analyst.
The analyst believes large institutions such as BlackRock, Charles Schwab, etc., are acting as the “Composite Man” Wyckoff was referring to.
Price Action: At the time of writing, BTC was trading at $28,866, up 7.55% in the last 24 hours, according to Benzinga Pro.
