Price Analysis

Bitcoin Descending Within a Broadening Wedge: Here’s Why a 20% Jump Could Attract a Bearish Trend!

Ever since the markets have shown signs of redemption, market participants have been hopeful of the upcoming trend. Moreover, the ‘v-shaped’ recovery that assisted the price to regain levels above $71,000 is considered a bullish signal for the upcoming trend. However, the bears managed to offer a strong hindrance at these levels, due to which the BTC bulls are falling short of strength after reaching these levels. 

Does this indicate the draining strength of bulls or is it a signal of the bears reclaiming back their dominance?

The BTC price just faced a minor upswing and was raised above the consolidation zone below $69,000. This move has also attracted some speculation, which may certainly not favour the bullish trajectory. As per the data, the open interest has soared by over $2 billion in the past couple of days while walking into spot resistance.

Meanwhile, it is not clear whether the traders are shorting or longing but the probability of shorts is pretty high. The drop from the ATH close to $74,000 has attracted significant shorts and hence this may be the major reason that the BTC price is failing to reach the crucial resistance at $72,500. The data from Coinglass shows a dark, thick patch of shorts has been accumulated above $72,000 till the ATH and hence tapping these levels suggests a huge liquidation. 

As per the chart, if the BTC price surges above $72,000, then it may trigger a liquidation cascade. Nearly $1.5 billion of short positions are ready to be liquidated, all the way up to $75,000. Therefore, if the bulls display immense strength and form a new ATH, then the BTC price may face a huge short liquidation and a significant rejection may follow. 

Collectively, Bitcoin (BTC) continues to remain in a decisive phase and hence a breakout may appear imminent. But if the price marks a new ATH, a strong rejection may also follow. 

Also Read : Memecoins Regain Momentum: FLOKI Surges by More than 25%, While PEPE & DOGE Catch Up!

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