After climbing above $48k on 29 March, Bitcoin embarked on its downtrend journey. It created a new local low at $44.2k on 1 April, post which it bounced back immediately. Even so, it couldn’t defy its downtrend. Lackluster movements were noted during the weekend, with the king coin consolidating within a tight range.
However, during the early hours of Monday, the asset’s valuation jumped to $47.4k, breaking above the aforesaid bearish trend line. Even before market participants could savor the moment, it tanked down to $45.7k.
Fake it till you make it?
The current price range in which Bitcoin has been oscillating has historically been quite a tricky spot. During its leg up in the rally phase in early 2021, Bitcoin consolidated in the $45k to $52k band for almost a month. Similarly, before BTC went on to re-peak in November last year, it spent some time in and around the same range.
During downtrend phases as well, the asset’s price has remained glued in the said area before tumbling down.
At this point, Bitcoin’s price has the potential to swing in either direction. But, if the chart were to be observed, it can be noted that Bitcoin usually peaks, consolidates, dips creating a local bottom, and re-rallies. Thus, with the first four actions already executed, it can be speculated that the coin is now gearing up for a re-rally.
In fact, even traders are anticipating a Bitcoin to break above $50k, for most of them have placed long bets. However, as analyst Ali Martinez pointed out, Bitcoin has seldom followed the herd and might briefly swing the other way round in the short term before climbing up.
Insufficient momentum persists in the Bitcoin market
Insufficient momentum remains to be a major hurdle on Bitcoin’s path. Barring one day [on 2 April], the net flows on exchanges have remained negative since 27 March, indicating the presence of buy-side momentum.
However, it should be noted that 3 out of the last four red bars have been quite minuscule. Over the past day, for instance, merely 240.8 BTC left exchanges. Thus, the deficient buy-side thrust is what is keeping Bitcoin grounded in its current price range, and only when that improves, Bitcoin would be able to successfully resurge.
