Bitcoin price has been stuck in a narrow consolidation range, leaving traders uncertain about whether the next move will be a breakout or a fakeout. With weeks of sideways movement, the market is closely monitoring key support and resistance levels for any signs of momentum. As sentiment shifts and trading volumes fluctuate, every move is being closely watched for its significance. At this crucial juncture, Bitcoin’s next move could potentially dictate the direction of the broader crypto market, making it a pivotal moment for both investors and traders.
The current price action has led investors to create a safe cluster around certain levels. The liquidation heatmap for Bitcoin shows the price trading within a liquidity cluster between $112,100 and $112,300, as well as around $110,800. The bulls are struggling to break above the upper cluster, which could potentially push the price lower to eliminate the sellers.
Moreover, the Open Interest has been steadily declining from over $87 billion to close to $80 billion. This indicates that future traders are either closing their positions or refraining from opening new ones. With money flowing out of the market, it suggests the beginning of an exhaustion phase, potentially leading to a reversal in the Bitcoin price. Additionally, the negative Coinbase premium and upcoming US inflation data could further push the price towards lower liquidity levels.
While the price has bounced back from local support at $107,300, the broader rally remains confined within a descending channel. The bulls are making attempts to break the resistance, with a successful breakthrough expected to propel the price above $113,400 and towards higher targets. However, the current price action shows signs of potential pullback, indicating a diverse price movement.
The Bitcoin price is currently trading within a descending parallel channel and attempting to breach the upper resistance. The price is also within the Ichimoku cloud, suggesting prolonged consolidation. A breakout followed by a retest could confirm a bullish trend, but the chart pattern indicates a possible rejection.
Although the RSI and CMF indicators are showing incremental movement, signaling a bullish trend, the previous pattern suggests a potential pullback to around $110,000 after testing the resistance zone at $116,800. Therefore, the next few days are crucial for Bitcoin’s price rally, as a rejection before a breakout could trigger lower targets around $110,000 or below. Traders and investors are advised to closely monitor these key levels for potential price movements in the coming days.