• Bitcoin is ready for a technical correction before another upside wave.
  • IOMP data implies that the upside is the path of least resistance for BTC.

Bitcoin (BTC) has settled above $13,000; however, further growth seems to be limited. The pioneer digital coin hit the recent high of $13,361 on October 25 and retreated to $13,110 by the time of writing. The coin has gained over 1.6% in recent 24 hours and over 14% on a week-to-week basis.  

Bitcoin's average daily trading volume is at $24.3 billion, while its market share settled at 61.2%.

BTC/USD bears are ready to strike back

The TD Sequential indicator presented a sell signal on the daily chart in the form of a green nine candlestick. This bearish formation implies that the upcoming selling pressure may push it for one to four daily candlesticks with the first aim at $12,000. However, considering the strong long-term fundamentals, BTC may resume the recovery after a short-lived correction.

BTC/USD daily chart

On the four-hour chart, BTC/USD is moving within the narrowing Bollinger Bands. A prolonged period of low trading activity implies that high volatility is underway as the squeeze of the Bollinger Bands and a stagnation period is usually considered as a precursor of large price movements.

A sustainable move below the lower band at $12,800 could signal a drop to $12,400 or $12,000. On the bullish side, in order to confirm the next upside wave, Bitcoin needs to break out above the upper band at $13,250, which coincides with the signal a jump to $15,000. 

BTC/USD 4-hour chart

The In/Out of the Money Positioning (IOMAP) confirms that there is strong support between the current price and $12,750 as over 1 million addresses holding over 800k coins. The next big cluster of addresses is registered on approach to $12,000, which is in line with the technical picture.

Bitcoin's IOMP data

Source: Intotheblock

Meanwhile, the market positioning data reveals that there are no significant barriers above the current price, meaning that the upside remains the path of least resistance now. 

BTC/USD: Key levels to watch

Considering the signals of the TD Sequential indicator and the on-chain data, Bitcoin may be ripe for a short-term downside correction with the ultimate bearish target at $12,800. This level will serve as a jumping-off ground and allow for a new bullish wave to take the price to $15,000. 

A move below $12,800 will bring more sellers to the market, with the potential downside aims $12,000 where a new buying interest is likely to appear.

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