Key Points
- Bitcoin’s liquidation levels and pwEQ may be key factors for potential price bounces.
- The golden cross formation of 50-day and 200-day MAs indicates potential upward momentum for Bitcoin.
Bitcoin, the most dominant digital asset, continues to draw significant analysis due to its price fluctuations.
The current market momentum has traders actively looking for opportunities, especially in high risk-to-reward ratio zones.
Bitcoin’s Recent Surge
Bitcoin experienced a surge during the weekly open, creating two major long liquidation levels due to high leverage. This aligned perfectly with last week’s equilibrium (pwEQ). However, the pump faced resistance as the bid-ask ratio tilted heavily toward the ask side, leading to a retracement.
This retracement brought Bitcoin back to critical levels, making these liquidation points and pwEQ key areas for potential price bounces.
The bid-ask ratio is now shifting toward demand, with more bids appearing within 2% of the current price. This suggests that entry levels around $62K to $63K could provide high returns if Bitcoin continues its upward momentum.
Golden Cross Formation
The $62K to $63K zone is emerging as a crucial level in the BTC/USD price action. The 50-day and 200-day MAs are nearing a golden cross formation, a bullish signal indicating potential upward momentum.
This pattern, combined with the liquidation levels and pwEQ alignment, strengthens the argument for further gains. The last time a similar golden cross occurred was last year, which preceded a significant bullish run.
Analyzing short-term holder behavior reveals that weaker hands have been exiting the market. When Bitcoin’s price drops, short-term holders often panic-sell, typically locking in losses.
This is reflected in an increase in purple bars on the chart, marking sell-offs during downturns. As weak hands exit, Bitcoin shifts to stronger hands, potentially stabilizing the market.
The STH supply has declined significantly, especially after major sell-offs, suggesting that selling pressure has eased. This decline in supply could create favorable conditions for accumulation, further supporting the importance of the $62K — $63K zone for high risk-to-reward opportunities.
The Momentum Short-Term Cap indicator, which measures the difference between Bitcoin’s market cap and realized cap over short-term periods, is showing signs of recovery, though slowly.
This ratio is a reliable indicator of market peaks for short-term holders, highlighting potential price thresholds.
While the current ratio indicates that the market is warming up, macroeconomic factors and slow recovery in momentum suggest that Bitcoin’s next major move may take time.
However, once these conditions improve, momentum could return rapidly, potentially pushing Bitcoin’s price higher and signaling the top of the current cycle.
Bitcoin’s current price levels offer significant potential, especially with strong technical indicators like the golden cross and declining STH supply pointing toward a bullish outlook.
With momentum building, BTC could see higher prices in the coming months.