Bitcoin prices are trading above the $21k level in a relief rally, lifting trader sentiment across the board.
BTC is up 12 percent in the last trading week at spot rates, breaking above a recent consolidating and shifting momentum to favor aggressive bulls. Traders expect prices to inch even higher in the days ahead and reverse recent losses following deep corrections that saw BTC slump by over 70 percent from peaks.
Technically, the bear run could be over, but price action, from a top-down analysis, is skewed to support sellers. Until there is a convincing close above $23k, a resistance level, bears may still dash bulls’ hope, rewinding gains.
Trader Sentiment Improving, Celsius Network Repays their BTC Loan
As mentioned earlier, the short to medium term trajectory for Bitcoin depends on the reaction at immediate liquidation levels, especially $23k. Thus far, the probability of Bitcoin ripping higher remains high because of fundamental factors. Notably, the bear run was accelerated by liquidity crises that impacted top centralized crypto lending platforms, including BlockFi, Voyager, and the Celsius Network.
While Voyager is restructuring, it has been revealed that Celsius Network has fully repaid its Bitcoin loan. Accordingly, they cannot be liquidated, a relief for BTC holders and traders who may have had to contend with more losses if Celsius’ liquidity crisis had persisted.
Bitcoin Technical Analysis
BTC bulls have the upper hand at spot rates, reading from the performance in the daily chart. The coin is trading above the middle BB and July 7 bull bar is with decent trading volumes.
In a bullish breakout formation above $21k, aggressive traders can ramp up on dips above the 20-day moving average with targets at $23k in the short term. Further gains above the liquidation level, powered by above-average participation levels, could further propel BTC towards May 2022 lows of $28k, triggering risk-averse traders into action.
If buyers are successful, the eventual ride could be with higher momentum and higher trading volumes. Thus far, the stochastic indicator indicates developing momentum and prices swinging from the oversold territory with diverging bands suggesting high volatility.
Leaning on caution, losses below $21k cancel the bullish preview, paving the way for sellers of early June 2022. In that case, BTC may slump further towards last week’s lows at $18.8k or worse.
Technical charts courtesy of Trading View.
Disclaimer: Opinions expressed are not investment advice. Do your research.
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