Despite Bitcoin's current bearish structure, there is a chance for a price increase towards the $88k mark.
Potential for a Price Bounce
Lower timeframes suggest a possible bounce if the $86.8k resistance level is breached. Fibonacci retracement levels indicate that the $72k support level could be the next target. However, on-chain metrics do not support this pessimistic outlook. Long-term holders seem to prefer holding onto their Bitcoin, which suggests hope for recovery.
Examining Bitcoin’s Downward Trend
The daily chart for Bitcoin retains its bearish structure. The On-Balance Volume (OBV) has also been in a downtrend since February, indicating that selling pressure remains dominant. This suggests the possibility of further losses. After falling below a 3-month-old range in early March, Bitcoin appears to have formed a new range. The mid-range level at $86.9k has been tested as both support and resistance in the past three weeks.
Technical Analysis and Long-term Holders' Support
The OBV has been making higher lows over the past ten days, but this is not indicative of strong buying nor enough to counteract the selling pressure from February. The 2-week liquidation heatmap shows that the closest liquidity cluster is at $88k. Traders must be prepared for the Bitcoin price to gravitate toward $88k before a bearish rejection. Technical analysis suggests that if $86.8k were flipped to support, it might be safe to go long. However, the liquidation heatmap suggests that might not be the case. Caution is advised, especially for the bulls.
Traders should carefully monitor reactions at resistance and support levels. A price rejection could present an opportunity for short-selling the asset.
