Technical Analysis
Maintaining Bitcoin’s Momentum
The recent upward momentum in Bitcoin’s price encountered resistance upon reaching the significant $37K mark. The market has now entered into a consolidation phase, with the price oscillating within the range defined by $37K and $35K. A breakout from this critical range will determine the subsequent trajectory for Bitcoin.
The Daily Chart
On the daily chart, the substantial uptrend in Bitcoin lost steam after breaking out from the $35K resistance zone and the middle trendline of the extended ascending channel. This transition led to a consolidation stage, presenting a crucial range between the resistance of $37K and the critical $35K support. Hence, Bitcoin’s future prospects will be determined by the price breaking out of this decisive range. Initial support for buyers is anticipated at the middle boundary of the ascending channel and the $35K support zone.
The 4-Hour Chart
Examining the 4-hour chart, Bitcoin’s price movement decelerated around the crucial $35K resistance and eventually entered a consolidation phase. The presence of an ascending wedge pattern, signaling a potential price reversal, suggests a need for a short-term retracement. In the event that sellers take control, a long squeeze event could unfold, pushing the price below the established ascending wedge pattern. Key support levels in such a scenario include the 0.5 Fibonacci retracement level at $32,300.
On-chain Analysis
Bitcoin’s recent notable uptrend has been significantly influenced by the futures market. Positive funding rates indicate the dominance of long-position traders who are willing to pay funding to short traders. During the period of a substantial surge in Bitcoin’s price, the funding rate metric exhibited a robust uptrend, signaling strong buying interest in the futures market. This positive trend aligns with the recent uptrend in the market, indicating that a majority of participants are inclined toward taking long positions. This overall bullish sentiment suggests the potential for further price appreciation. Prudent risk management strategies are advisable during such market conditions to navigate potential fluctuations and unexpected events.
Hot Take
Navigating Bitcoin’s Ongoing Momentum
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