Since last Friday, bitcoin has seen a 4% pullback, following a strong 15% surge from its local lows. Despite this recent momentum, the market is facing uncertainty and volatility as btc trades below the crucial $60,000 level, a psychological marker that indicates a direction.
Investors are watching closely to see if bitcoin can regain strength and break above this key resistance or continue to struggle in the near term.
There are signs of recovery, however, as Coinbase data shows that btc is back to trading at a higher price, indicating strong demand. Additionally, key data from Coinglass highlights the critical liquidity levels that btc may reach in the coming weeks.
These factors suggest that btc is now at a crucial juncture, and its price action in the coming days is likely to determine the direction of the market in the coming months. Traders and investors are preparing for bitcoin’s next big move.
bitcoin Consolidation May Be Over: $70,000 Now?
The past few weeks have been encouraging for bitcoin, sparking hope and optimism among investors who are bracing for a deeper correction. Recent data indicates a positive shift in market sentiment.
Analyst Daan x.com/DaanCrypto/status/1835212453975572975″ target=”_blank” rel=”noopener nofollow”>highlighted in x btc has been trading at a premium on Coinbase, a sign of renewed spot demand from US investors and potential interest from ETFs. This premium is generally bullish, reflecting increased buying activity and confidence in btc’s future.
However, significant stock discounts, often seen at market lows, can signal bearish sentiment, although they also offer potential entry points for savvy investors.
As an add-on, Coinglass has provided key metrics on bitcoin liquidity levels. Binance’s btc/USDT liquidation heatmap shows that btc recently absorbed a large pool of liquidity below $50,000 during the August 5 sell-off. This move broke through substantial support levels, leaving fewer significant pools nearby.
Major liquidity levels now sit around $47,000 and below, with substantial interest building up at the $70,000+ mark.
This data suggests that while bitcoin is facing potential support and resistance challenges, current market dynamics indicate a more bullish outlook.
The absence of significant liquidity pools around the current price and the premium seen on Coinbase could indicate a continued upward trajectory, provided btc can maintain its recent gains and build momentum.
btc Technical Analysis: Key Levels to Watch
bitcoin price is trading at $58,593, reflecting a 4% drop from last week’s peak of $60,670. The cryptocurrency is facing challenges to maintain its position above the 4-hour 200-day exponential moving average (EMA) at $58,883, a crucial level it reclaimed last Friday, indicating near-term strength.
This EMA has acted as significant resistance since early August and could serve as new support if btc can sustain above it.
To reinforce the bullish outlook, bitcoin must rebound and sustain above the 200-day 4-hour EMA and the $60,000 mark as these levels are crucial in shaping the overall market sentiment. If it fails to close above the 200-day 4-hour EMA, it could test the next level of demand around $57,500, which represents a healthier support zone.
If the correction extends further, btc faces potential risks of dropping to $55,500. This deeper correction would test lower support levels and could signal more challenging market conditions ahead. Staying above these key levels will be critical in determining bitcoin’s near-term direction and overall market stability.
Featured image of Dall-E, chart from TradingView
