Could The More-Than-90-Year-Old Technical Analysis Theory Be The Reason For BTC Rally?

Bitcoin (BTC) price appears bullish after almost two years of negative sentiments, price action, and news.

Many enthusiasts imply that the change is stimulated by the 90-year-old TA theory known as the ‘Wyckoff Method’ postulated by the late American Investor.

Traders believe prominent players like Charles Schwab’s EDX Market, BlackRock, Citadel Securities, and Fidelity Digital Assets act as the ‘Composite Man mentioned in the TA theory.’

Positive Investment News and Actions Cause Bitcoin Price to Rally Up to 28,000

Currently, Bitcoin is changing sentiments and rallying prices. This sudden change emerged due to certain positive news in the market after some days of regulatory clampdowns and uncertainty.

Some investment companies filed for spot BTC exchange-traded funds (ETFs). The first was BlackRock, the largest asset management firm globally. 

BlackRock filed for a Bitcoin Spot ETF with the United States Securities and Exchange Commission (SEC). Regardless of the ongoing SEC lawsuit, BlackRock is handling this transaction via Coinbase. 

EDX Markets, a new crypto exchange backed by notable financial investors like Charles Schwab, Citadel Securities, and Fidelity Investments, also filed a Bitcoin ETF. Another investment firm that filed for a BTC Spot ETF is the NY-based asset management fund WisdomTree. 

On Wednesday, June 21, WisdomTree filed a request, asking the SEC to enlist its “WisdomTree Bitcoin Trust” among the Cboe BZX Exchange with the “BTCW” ticker.

Moreover, other crypto pundits believe that the cause of the price rally of Bitcoin isn’t only because of the fantastic investment news from huge investors. Some crypto analysts believe the rally was caused by an over-90-year-old TA theory. 

The Wyckoff Method and Its Impact on BTC Price Action

The changing market trend appears to surprise many crypto investors, whereas a 90-year-old technical analysis theory predicted this would occur. This TA theory, called the ‘Wyckoff Method,’ was established in the 1930s by American stock market investor Richard Wyckoff. 

He was one of the founding fathers of technical analysis. He created his theory that retail traders should act like an imaginary entity, the Composite Man, who controlled the market. The Composite Man, explained by Wyckoff, was institutional traders, or prominent actors, also called ‘Smart Money.’ 

The institutional traders would accumulate assets at low prices, and when they’ve sufficiently established a position, they reveal their presence through price markup.

In addition to trailing Wyckoff’s Accumulation Pattern, the sudden rally in price action appears close to recent investment moves made by institutional investors like BlackRock, Citadel Securities, Charles Schwab, Sequoia Capital, and Fidelity Digital Assets. 

Traders are now suspicious whether these investors could be acting as the ‘Composite Man’ referred to by Richard Wyckoff.