Is Massive Rally Ahead? BTC on Track for First Kumo Breakout Since October

Bitcoin, the flagship cryptocurrency, surged to an intraday high of $79,490 earlier today, currently flirting with the psychological $80,000 barrier.

According to prominent trader Josh Olszewicz, the leading cryptocurrency is currently on the verge of its first daily Kumo breakout since October.

The significance of a Kumo breakout

"Kumo" (or "cloud") is the key component of the Ichimoku Kinko Hyo indicator. The cloud is formed by two leading moving averages. It acts as a dynamic zone of support and resistance.

A certain asset is considered to be in the middle of a bearish trend when the cloud acts as overhead resistance. The market enters a consolidation phase when the price is inside the cloud. At the same time, the price of a certain enters a likely uptrend when it breaks above the cloud.

The one-day chart shared by Olszewicz shows that Bitcoin has been trapped in a grueling downtrend since its peak, remaining below a thick bearish red cloud. Every attempt to stage a new rally has been rejected so far.

However, there is a glimmer of hope for the bulls. Bitcoin's price has now penetrated the bottom of the red cloud and is currently trading inside it. $BTC is currently pressing directly against the upper boundary of the cloud.

If Bitcoin manages to print a daily close above this top resistance line, it will confirm the first true Kumo breakout since October.

Bears are getting crushed

Meanwhile, there has been a significant wave of forced liquidations targeting traders betting against the market.

According to the latest liquidation data from CoinGlass, the crypto market has witnessed $220.96 million in total liquidations over the past 24 hours.

The vast majority of this carnage has fallen on short sellers. A staggering $186.64 million in short positions were wiped out in a 24-hour window.