The start of the month was bearish but the beginning of the weekly trade was one of the worst price actions. The massive price crash that dragged the Bitcoin price below $50,000 for the first time in the past 6 months terrified the market participants. However, some of them found it a good buying opportunity, knowing that the markets have not been under bearish pressure for long. As a result, the BTC price has triggered a rebound, regaining $54,000, while sustainability remains a major concern.
The latest price crash replicated the thunderclap of the FTX & Terra ecosystem collapses, the China mining ban and the COVID-19 crash. The short-term holders’ SOPR readings were almost the same as during these events, which suggests they suffered a huge loss yesterday.
Besides, yesterday’s move also turned the funding rates negative after a long time in the past 5 months. This suggests that the shorts are paying longs to maintain market equilibrium, which may further encourage them to open more short positions. The open interest levels faced one of the biggest liquidations the crypto markets witnessed for the first time since the FTX collapse.
These fractals display the possibility of a bullish reversal if the second open interest level is tested, which may happen only if the price rises slightly. Technically, the BTC price continues to remain under the bearish influence while the bulls are leaving no stone unturned to reclaim the crucial resistance. Considering the current trade setup, it suggests that the Bitcoin price is required to reclaim the $53,000 support this week, which may allow the bulls to reclaim their dominance. However, to restart with a strong upswing, the token needs to rise much above these levels.
The historical chart pattern suggests the 200-day MA has always indicated the next price action, as it is considered major support or resistance depending on the trade setup. Currently, these levels appear to have been capitulated, similar to what happened in 2020, 2021, & 2022. If the BTC price reclaims the 200-day MA at $61,602, then the token is believed to begin with a fresh bull run, as it happened in 2020 & 2021.
However, if the Bitcoin (BTC) price fails to rise above the levels that happened in 2022, market participants need to be prepared for another bearish wave.
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