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      Bitcoin Back to $80K: Liquidity Grab Candle Implies Reversal

      Published: just now

      Bitcoin Back to $80K: Liquidity Grab Candle Implies Reversal

      Bitcoin has fallen as low as $74.5K yesterday, liquidating approximately $970 million across crypto exchanges in the last 24 hours. Then, the asset closed above its last pivot low at $76.6K—and formed a wick of over 5%.

       

      This beautiful, yet nasty price action comes with a few bullish implications for Bitcoin:

       

      • We witnessed a liquidity grab, where long traders were effectively ‘long squeezed’ and forced out of their positions.
      • When the long traders are forced to sell at speed, buy orders are filled at speed, strengthening the possibility of a revesal.
      • Bitcoin has technically closed at $79.1K, higher than its previous pivot low.

       

      However, we are not out of the woods yet, Bitcoin must close today’s candle positively to show buyer strength and follow through.

       

      Visual content

      Source: Coinglass, recorded at 11:30AM GMT+8 time (11:30PM New York Time)

       

      Bitcoin Resilience: Huge Volume Spike with Bullish Divergence

       

      Go over to the BTCUSDT daily chart, and you noticed a few things:

       

      • The liquidity grab candle formed with a large volume spike, validating its role.
      • Bitcoin has managed to retap into $80K twice in the past two days, showing some resilience.
      • falling wedge pattern appears to be forming, a bullish reversal chart pattern.
      • regular bullish divergence appears to be in play with the RSI indicator.

       

      Visual content

       

      If Bitcoin is to move up higher from here, the entire crypto markets should experience some recovery as well. However, this would also be dependent on the SPX’s performance.

       

      Bitcoin currently is traded like it's a tech stock/risk-on investment, rather than its intended purpose of being a safe haven (like Gold), and therefore correlates to the SPX. If the SPX continues to decline, then so will Bitcoin’s price.

       

      For more on SPX's forecast, check out our recent analyses:

      S&P 500 Elliott Wave: The Correction Is Resilient

      Fear Sweeps SPX Markets as Retail Expects Black Monday 

       

       

      Alchemy Markets is a multi-asset brokerage providing retail traders with the same elite trading conditions, tools, and transparency typically reserved for institutions.

      This content may have been written by a third party. LiquidityFinder makes no representation or warranty and assumes no liability as to the accuracy or completeness of the information provided, nor any loss arising from any investment based on a recommendation, forecast or other information supplies by any third-party. This content is information only, and does not constitute financial, investment or other advice on which you can rely.
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