Analysis of the potential price level of Bitcoin under these market conditions
Corrections are part of any bull market and the majority of investors now expect Bitcoin to bounce back from where it is now. While near-term development looks healthy at the moment, the daily chart has received slight bearish confirmation, suggesting that another bearish market is likely.
It is important to note that if the current data set does not indicate a future trend or direction, Bitcoin can bounce back at any time.
Bitcoin market on chain volume
Since the beginning of 2020, Bitcoin’s bull run has identified different areas of liquidity based on market volume and on-chain. These levels essentially underscore the wide range of trading sessions in which both buyers and sellers are heavily involved in keeping the order book flow going.
Well, as shown in the graph, there are several factors that determine these levels of support and resistance. These include the trading volume, the token value transferred in USD, the outflow from Coinbase and the buy / sell volume of the taker – which takes liquidity by executing open orders on the exchange.
Bitcoin’s recent rally occurred at the first point of volume support, which is in the $ 57,000- $ 55,000 range (note: BTC jumped straight from $ 55,600).
However, any subsequent correction will cause the price to slide into the $ 46,000- $ 49,000 range, potentially another 10% decline from current levels. Previously, analyst Michael Van Poppe had proposed a similar scenario.
Futures market looks short
The part of the market that is expecting the next correction is leveraged traders. According to the data, in the short term, market sentiment will decline and traders will short BTC on the eternal futures market. In addition, the estimated leverage reached a new all-time high, but the securities on the futures market declined.
Since the open interest is still at a high level, this indicates that a concentrated sell-off is taking place on the chart and is more likely to push the market in a deep downward direction.
What about CME futures?
The pressure to sell CME futures remained minimal. Since the end of May 2021, the CME futures have not been that hot and the general pressure has shifted in favor of the spot volume.
While a correction is still expected, BTC could also soar above $ 60,000 in the next few days. If it is possible to hold a position above $ 62,500, bearish speculation will be void, if not, bearish pressure may reappear.
Join Bitcoin Magazine Telegram to keep track of news and comment on this article: https://t.me/coincunews
According to Ambcrypto