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Bitcoin Up 20%, Bullish Rally Underway? Analysis for July 16, 2024
After falling below $60,000, Bitcoin managed to bounce back by more than 20%. Let’s analyze the future prospects of the BTC price together.
Bitcoin (BTC) Price Situation
After attempting to bounce back to $60,500, Bitcoin unfortunately faced selling pressure that sent its price crashing to $53,500. It is at this price level that BTC selling subsided in favor of buyers. Indeed, after consolidating in the form of an ascending triangle below $59,000, Bitcoin’s price benefited from buyer support, pushing its price above its last peak identified around $63,800. This technical breakdown suggests the possibility of a reversal of the short-term bearish trend of Bitcoin currently underway.
At the time of writing, the Bitcoin Price is trading around $63,000. So, Bitcoin seems to be undergoing a slight downward correction. However, the recent fluctuations of the leading cryptocurrency have allowed its price to return above its 200-day moving average. Although Bitcoin remains below its 50-day moving average, this is more convincing regarding the continuation of its medium-long term trend. As for the price momentum, it is not surprising that it has bounced, as indicated by the BTC price itself and the oscillators. All these elements undeniably demonstrate significant new buying interest, making investors optimistic about the future of the cryptocurrency price.
The current technical analysis was conducted in collaboration with Elie FT, a passionate investor and trader in the cryptocurrency market. Today he is a trainer at Family businessa community of thousands of proprietary traders active since 2017. You will find Live, educational content and mutual assistance on financial markets in a professional and friendly atmosphere.
Focus on Derivatives (BTCUSDT)
Bitcoin perpetual contracts open interest has increased by more than 28%, with nearly $2.5 billion in positions added. Although it has recently declined, this increase, combined with an increase in its underlying asset, a positive funding rate, and insignificant liquidations, indicates that most speculators expect the price of Bitcoin to rise.
Following the surge in Bitcoin this weekend, it can be seen that CME Bitcoin contracts have left a rise behind split.
A bullish gap occurs when the price of a financial asset opens significantly higher than its previous closing price, creating a gap in the price chart. This phenomenon often indicates strong buying pressure and can signal an impending upward move.
The liquidation heat map of the past few months shows that BTC/USDT has come into contact with the liquidation zone around $65,000. It seems that the cryptocurrency has attracted selling interest, as its price has been rapidly revised lower. Currently, the most significant liquidation zones of the past few months are located on both sides of the Bitcoin price. Above the current price, we can notice the zone around $67,500. However, the most obvious one is further away, located between $72,000 and $73,000. Below the current price, we can notice the thin zone around $56,000 – $57,000. If the market approaches these levels, we could see a massive order trigger, potentially increasing the cryptocurrency’s volatility. Therefore, these zones represent important points of interest for investors.
Bitcoin (BTC) Price Hypothesis
- As long as the price of Bitcoin can stay above $61,000, we can expect a break of $64,000 – $65,000. The next resistance to consider, if the upward movement continues, would be the area around $67,500. Higher up, we can highlight $69,500. At this point, this would represent an increase of about 11%.
- If the price of Bitcoin does not stay above $61,000, we could consider a support of buyer interest around $60,000. The next level to consider, if the downward movement continues, would be the value zone slightly below $58,000. Further down, we can place $54,000. At this point, this would represent a decrease of almost 14%.
Conclusion
Despite the initial selling pressure, Bitcoin found significant support that allowed its price to recover. Although it is undergoing a slight correction, Bitcoin is showing positive signs of recovery, strengthening investors’ confidence in its future prospects. However, it will be essential to closely monitor the price reaction at different key levels to validate or invalidate current assumptions. It is also important to remain vigilant against potential “fake outs” and market “squeezes” in each scenario. Finally, remember that these analyses are based solely on technical criteria and that cryptocurrency prices can also evolve rapidly based on other more fundamental factors.
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Family business
Family Trading is a community of proprietary traders active since 2017 that offers live sessions, educational content and support on financial markets, including cryptocurrencies, with Elie FT, an investor and trader passionate about the cryptocurrency market, at its side.
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