Bitcoin’s price volatility has increased since the beginning of October. During this period, BTC has hit highs of $66,500 and lows of $58,800, the latter of which was reached less than 24 hours ago.
The drop below $60,000 had a huge impact on Bitcoin holders, with many being forcibly liquidated. In fact, over $107 million has already been liquidated.
This rise in volatility, coupled with current market conditions, raises questions about BTC’s future trajectory. That’s why popular cryptocurrency analysts such as Rick Capital suggest that BTC must remain above $60,600 for potential upside.
What does market sentiment say?
RektCapital posits in its analysis that Bitcoin is retesting the $60,600 weekly re-accumulation range as support for the second week in a row.
According to this analysis, if BTC closes above this level on the weekly chart, it will register an uptrend. Therefore, for any potential upside in the near term, BTC must hold this range, which will set the stage for further price gains.
However, the analyst also noted that if the cryptocurrency loses support here, it will usher in another period of downside deviation.
What does the chart show?
At the time of writing, BTC is trading at $60,573, which marks a 0.58% drop on the daily chart and a 1.01% drop on the weekly chart.
Therefore, based on the recent price action, the above analysis by RektCapital may be concerning as it predicts potential downside risk.
Therefore, it is crucial to determine what other market fundamentals are suggesting.
First, Bitcoin’s major shareholder inflows have surged from 560.95 to 8.59k in the past few days. A surge in major shareholders means that investors are buying low and taking long positions.
Such market behavior also suggests that large holders expect prices to rise in the near future.
Additionally, Bitcoin’s money flow ratio surged from a low of 0.032 to 0.077, indicating higher buying pressure as investors are saving money to buy BTC.
This behavior is often associated with bullish market sentiment.
Lastly, Bitcoin’s exchange reserves have also continued to decline over the past month. This suggests a long-term holding strategy as investors are unlikely to sell their BTC in the short term. Mostly, this is a bullish sign as it reduces the supply on exchanges, lowering potential selling pressure.
Simply put, the recent downtrend has lost momentum and Bitcoin could be well positioned for further gains. If the positive market sentiment holds, Bitcoin will retake the $61,875 resistance level. If this level cannot be sustained, Bitcoin will fall to $58,272.
