What we have: ✅ Price above the lower descending channel border on the daily chart ✅ Recovery setup looking favorable ✅ Volume surge confirming strength
Bitcoin is now trading around $88k (Weekly Open) so other that a few days of volatility this week, the price has not moved anywhere. The orange downtrend continues to give strong resistance, with multiple 4hr candles rejecting from this over the past 10 days. As usual, we can expect a low volume Saturday, but if this downtrend is broken then we could see BTC push towards $90k heading into the weekly close. For now I am being patient, but will be watching for a break of key levels.
The price action on Bitcoin the past 2 days has been perfect for wiping out both longs and shorts- both of the previous US sessions opened with strength before seeing rapid 5% rejections. Despite this, the $85k area remains solid but we must remember that the more an area is tested the more likely it is to fail. Eventually $85k could break and lead to a huge liquidation event.
BTC is now pushing into an an area (above $88k) where we have seen strong resistance, and I would now like to see a clean break of the orange downtrend before considering longs here.
BTC reacted from the $85k area after the dump, which was an important 4hr level to hold. It needs to see a 4hr close above $88.1k (Weekly Open) and then we can see another push for $90k. I will be looking for further opportunities today, but remember we have the US CPI release coming up so volatility is likely.
I mentioned in yesterdays update that $88.1k (Weekly Open) was likely to be resistance for Bitcoin and, after a period of recovery, that is exactly where the rejection came. As week as being the Weekly Open, this was also a bearish retetst of the orange trendline. If this resistance is reclaimed, we could see a push towards $90k where the CME gap has not been fully closed. $85k (Monday Low) remains a critical level to hold as support on any further retests.
Yesterday we saw Bitcoin sweep $85k, which is an area I have been mentioning for many days. I also expect we could see resistance at $88.1k (Weekly Open.) If we see 4hr acceptance above $88.1k then we can see a fast move towards $90k.
Any retest lower and $85k must hold, or $80-$78k could be next. Now that the Monday range has formed I will be looking for more opportunities. The Monday range this week is $85k - $89.9k