22 August 2024
After experiencing a significant 25% pullback earlier this month, plunging to the $49,000 level, the king of cryptocurrencies, Bitcoin (BTC), has managed to consolidate above the crucial $60,000 support for the last 24 hours.
However, Bitcoin’s journey toward further price appreciation has been without obstacles. The digital asset has been unable to surpass higher resistance levels, which technical analysts deem essential for a retest of the all-time high levels reached in March.
What On-Chain Metrics Reveal
According to a recent analysis shared on social media platform X (formerly Twitter), technical analyst Inspo Crypto has highlighted the cautious sentiment among options traders. While they remain bullish, they continue to hedge against potential downside risks, suggesting an expectation of a potential market shakeout or negative news.
The analyst also contends that the selling pressure on the upside has been robust. Wednesday’s price push-up primarily triggered sell orders, leading to the liquidation of high-leverage long positions.
Delving deeper into the market data, the options market reflects a mixed outlook with slight bullish tendencies, but the 25-Delta Skew indicates uncertainty, particularly with upcoming economic events influencing trader caution.
In the futures market, the data shows short-term bullish momentum but with increased volatility. The rising open interest suggests more market participation, yet the liquidation heatmap highlights the risks of sudden price swings.
Bitcoin Breakout To $63,000 Or Consolidation At $60,000?
Turning to the spot market and technical analysis, the data paints a picture of bullish momentum, but the cryptocurrency faces strong resistance at the $61,300 to $61,500 levels.
The volume, however, appears insufficient to facilitate a significant breakout, and the order book data reveals substantial sell-side pressure at these levels.
Inspo Crypto further found that the average trader sentiment is neutral to slightly bullish, with a rating of 5.5 out of 10. Traders are cautiously optimistic, but there are clear signs of uncertainty and potential volatility.
The price forecast for the next 24 hours suggests that Bitcoin may continue attempting to break the $61,300 to $61,500 resistance level.
However, a genuine breakout seems unlikely without a substantial increase in trading volume. If the resistance holds, a pullback toward the $60,000 or even the $59,500 level is possible.
For the rest of the week, if Bitcoin manages to break through the $61,500 level with increasing volume, a move toward the $62,500 to $63,000 range could follow. Otherwise, consolidation between $59,500 and $61,000 is likely, especially if market volume remains low and selling pressure persists.
Late Wednesday, BTC climbed above $61,7000 for the first time in nearly two weeks but has since fallen back to the $60,000 level. Still, the Bitcoin price is up 1.8% over the past 24 hours.
Featured image from DALL-E, chart from TradingView.com