Bitcoin (BTC) saw another failure to break out of a tight trading range until April 6 as $28,000 again hung in the balance.
Analysis Sees Traders “Compressing” BTC Price
Data from Cointelegraph Markets Pro and TradingView it showed BTC/USD trading below the $28,000 mark at the time of writing.
The pair had neared $29,000 the day before, eating up demand liquidity in what the research called a “choreographed” move by the whales.
That seemed to be true, as the bullish momentum soon faded and the spot price remained in an ever narrowing range.
In a follow-up comment, monitoring resource Material Indicators noted that traders had moved the supply and demand for liquidity relative to each other, “compressing” the likely zone of movement for the spot price.
“Liquidity cushions volatility,” he summarized.
Liquidity cushions volatility. #FireCharts shows that both sides appear to be moving #BTC liquidity closer to the active trading zone, effectively compressing the range. Gaps that are not filled or defended with buy/sell walls are prone to being exploited… and yes, that means both… pic.twitter.com/3ZDrfJeaVh
— Material indicators (@MI_Algos) April 5, 2023
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Considering what the outcome of current price action could be in short timeframes, analytics resource Skew devised two outcomes.
He described BTC/USD as “crab”, moving sideways, with little room to maneuver.
$BTC 4H
Not much changed, still crab-crabs in tight 4H rangePrice struggling to stay above 1D range high; generally involves one of two outcomes:
1. Grind with the trending EMA (compression before expansion) / hold low 4H range
2. bleeds towards the low 1D range and there the break occurs. https://t.co/n76XG7Z6io pic.twitter.com/rJ2dEE14O0
— Skew Δ (@52kskew) April 6, 2023
‘Double Top’ Concerns Persist
Meanwhile, pulling away, trader and analyst Rekt Capital saw a trip to $27,000 as a potential sign that a longer-term “double top” formation is underway.
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“BTC’s recent rejection of Double Top resistance means that BTC could still drop from here to complete the second part of the formation,” he said. tweeted of the day together with an explanatory table.
“Typically, double tops resemble an “M” shape, so the second part of the pattern would form with a ~$27K (blue) drop.”
Others remained generally bullish on the path of Bitcoin for the coming year.
After such a strong start, trader and analyst Credible Crypto doubled down on his prediction that BTC/USD would set a new all-time high in 2023.
“A drop to 23-25k that I’ve been talking about for weeks doesn’t change any of that. There is nothing to worry about”, part of a recent comment fixed.
Previously, Cointelegraph reported on calculations calling for another bullish double top for Bitcoin in 2025, which could surpass $200,000.
The views, thoughts and opinions expressed here are those of the authors alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
