On the social networking platform X, a popular cryptocurrency trader predicted that Bitcoin’s price could soon drop to $63,000. The prognosis was based on liquidity dynamics which have driven Bitcoin’s price over the last few weeks.
Bitcoin market structure suggests more volatility ahead
KillaXBT published a post for the 4th April on X. revealed Possible trajectories that the Bitcoin Price could take over the next few weeks. This crypto trader’s analysis relies on BTC’s current technical structure, which includes multiple levels of support and resistance visible in its weekly timeframe.
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Analyst explained to investors that in the last few weeks, they had seen multiple sweeps of external highs as well as internal lows. More precisely, the sequence appears to have started about four weeks ago with a sweep of external range highs, which in turn triggered a swift reversal of the Bitcoin price — eventually leading to a bearish weekly close.
KillaXBT stated that this was due to the fact that Bitcoin needed to find its balance. This led to the weekly candle of Bitcoin’s flagship cryptocurrency returning to $71,500. This move, it seems, was made with the intention to increase Bitcoin’s value. sweeping late short positions, before prices reversed bearish once more — a move KillaXBT pointed out to be the classic liquidity hunt seen before reversals.
The crypto-pundit noted that the candle of the week before had closed in a bearish manner. This week, however, also saw sweepings (another event for rebalancing). This sweep was followed by a downward rejection in the BTC rate.
KillaXBT argues that because Bitcoin is recovering mainly due to leveraged trades and the market structure has already turned bearish, it’s likely that available buy pressure The liquidity might be soon exhausted. As a result, it appears that the lows of $64,900 are vulnerable to another liquid sweep.
The technical analyst believes that Bitcoin will also breach the lows of the external range at $63,000 in the medium term. A market quant pointed out that the recent downward trend is consistent with expectations for an immediate reverse towards $72,800. Another sell-move lies ahead.
Short-Term Investor Activity Supports Near Term Bearish Sentence
Joao Webster, a chain analyst on X’s website, has posted another blog on the subject. shared The data suggests that short-term Bitcoin participants are increasingly selling their Bitcoin holdings. This is the relevant indicator, which is Short-term Holder Net Position Change.
This cohort includes most investors who are new to Bitcoin and have only held it for a few days. This means that they react more quickly to changes in the price than experienced traders.
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The activity of the new owners can reveal a change in attitude (in this instance, one that is bearish). This (impulsive sales activity) can cause the Bitcoin price to fall, since these sales add bearish pressure.
In the short-term, it is possible that the leading cryptocurrency in the world could be headed towards $63,000 before real recovery can be observed. Bitcoin currently trades around $67.256. That’s a 0.5% gain in just one day.
Featured image is from iStock and chart comes from TradingView
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Source: www.newsbtc.com
