Bitcoin’s $90K Support Level: A Stepping Stone to New Heights or a Temporary Reprieve?
Bitcoin has been making waves in the cryptocurrency market, with its price hovering around the $90K mark. This critical support level has sparked a slight recovery, but the question on everyone’s mind is: will this be enough to trigger a fresh rally towards a new all-time high?
A Closer Look at the Technical Analysis
Bitcoin’s daily chart reveals a strong support zone at $90K, which aligns with the middle threshold of its multi-year ascending channel. This support level has been a game-changer, as it has halted the downward pressure and sparked a minor bullish rebound. However, the current momentum remains subdued, suggesting that consolidation near this support zone is likely to continue in the short term.
For Bitcoin to initiate a new rally and aim for a new all-time high, the market needs to witness heightened demand and stronger bullish momentum. Until then, the cryptocurrency will likely remain in a state of limbo, awaiting a more evident directional move.
The 4-Hour Chart: A Pivotal Defence Zone
The 4-hour chart paints a similar picture, with the $90K support level emerging as a pivotal defence zone. The price action has recently formed an inverted head and shoulders pattern near this level, accompanied by an accumulation phase, signalling a potential bullish resurgence. However, increased market demand and buying activity are necessary for BTC to break out and target the significant $108K resistance.
On-Chain Analysis: The Role of U.S. Investors
American investors, particularly U.S. institutions, play a significant role in driving market movements. Analyzing their behaviour can provide valuable insights for predicting short-term market trends. The Bitcoin Coinbase Premium Index is a critical metric that compares buying and selling pressure on Coinbase, a U.S.-centric exchange, against Binance.
The chart reveals that the Coinbase Premium Index has recently seen a notable increase, breaking above its 14-day Simple Moving Average for the first time in recent months. This shift in market dynamics indicates that U.S.-based buyers are showing renewed interest and exerting buying pressure. If the Coinbase Premium Index sustains levels above its SMA14 and moves into positive territory, it would signal that U.S.-based investors are becoming dominant in Bitcoin’s market activity, potentially leading to a bullish rally driven by heightened demand.
What’s Next for Bitcoin?
As Bitcoin continues to consolidate near the $90K support level, the market is eagerly awaiting a more evident directional move. Will the cryptocurrency break out and target new heights, or will it remain in a state of limbo? Only time will tell. One thing is certain, however: the role of U.S. investors will be crucial in determining the next move.
What do you think? Will Bitcoin break out and target new heights, or will it remain in a state of consolidation? Share your thoughts in the comments below!
Source: Cryptopotato.com
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