Bitcoin has become entangled in an immense bullish trend in recent days, with buyers in full control of the price action as the cryptocurrency is taking a serious distance from its recent lows.
It is important to note that the recent $ 23,700 rejection turned out to be quite significant for the cryptocurrency as the price has fallen lower since then.
A trader now notes that where the medium-term trends are happening should depend largely, if not entirely, on whether bulls can maintain their momentum and build strong support in the lower-priced USD 20,000 region.
Any sustained dip below $ 20,000 would be devastating for the crypto and possibly cause it to see a strong downside in the medium term.
A trader notices that now Bitcoin is starting to show some signs of weakness on his chart, but he notes that his macro strength and recent break above its high could one day leave room to see further upward.
He also notes that futures funding has become “aggressively bearish-biased” in recent hours, which could be a grim sign.
Bitcoin is struggling to extend momentum as consolidation begins
At the time of writing, Bitcoin was drops just under 1% at the current price of $ 22,670. This is around the price it has been trading at in recent days.
Yesterday, the crypto soared to $ 23,700 before losing momentum and sliding down. Selling pressure in this price region was significant, indicating that the rally was overheated.
Today’s price action has been mostly consolidation and it looks like it will break back above USD 23,000 in the near term.
BTC Futures funding is Bear– Suggested if graph shows signs of weakness
He also notes that BTC futures financing is starting to show signs of being heavy across the board bearbiased.
“Normally I would say this looks bearish, but given all the circumstances surrounding BTC at the moment, I almost think it’s more likely that this will break up than it will break up. Anyway, it’s consolidation, and consolidation is leading to bigger moves … That said, futures financing across the board is being aggressively bearish-biased right now. “
Image Courtesy of Jonny Moe. Source: BTCUSD on TradingView.
Bitcoin’s upcoming weekly candle close should shed some light on the sustainability of this last step up.
Featured image from Unsplash. Charts from TradingView.