Sahana Vibhute
The recent price action of Bitcoin has made market participants extremely impatient, as they are falling into the FUD trap. The BTC price is printing its second bearish daily candle after failing to surpass $64,000 during the recent upswing. This move appears to have made the traders sure of the trend, marking lows below $60,000 and as a result, the shorts are getting piled up heavily. The bears have begun to increase their activity, implying that Bitcoin and the entire market could remain stuck under their influence for a long time.
What’s next? Will the BTC price plunge to $58,000 or is another bear trap about to be laid?
The weekend trade, which lifted the BTC price above $63,500, seems to have attracted more participants to the platform. Unfortunately, they opted to extract the profits rather than infuse more liquidity. The active address count, which was consolidated below 800K for over a couple of months, underwent a decent rise above 900K at the beginning of the month.
This suggests the traders have shifted their focus back to the star token, which has negatively impacted the price. This is one of the reasons why Bitcoin is failing to sustain above $62,500 as the traders continue to extract profits for small gains. As per some data, 20% of the Bitcoin supply changed hands above $62,000, which may have caused the recent drop. Now the question arises: how long will the price remain stuck below $62,000?
As the bulls display weakness, the shorts are getting piled up at this crucial resistance around $62,500. If the price rebounds back to these levels, then nearly $1 billion in shorts will be liquidated. Therefore, this may be the reason why the BTC price is heavily accumulating within the range. With this, the bearish narrative emerges, which sheds light on the possibility of plunging back to $58,000.
Ever since the price rose above the consolidation, it chased the ascending trend line and eventually surged above the range, turning it into a strong support. However, the recent pullback failed to lift the levels above the trend line. As a result, the token is about to enter the crucial support zone between $61,160 and $60,213 and may also drop below these levels. Besides, the RSI is heading back to the lows, while on-balance volume has dropped below the average range.
Therefore, bearish clouds continue to hover over the crypto markets as the Bitcoin price is feared to drop below $59,000 in the coming days. Although the bulls may initiate a rebound, due to a drop in their strength, the intensity of the upswing could be extremely less than required.
