Bitcoin Weekly Forecast: Should you buy BTC here?

• Bitcoin price contemplates a potential reversal after dipping into the weekly imbalance zone extending from $59,111 to $53,120.
• On-chain and social metrics forecast a potential involvement from whales buying the dips. 
• A successful recovery rally could send BTC beyond the current all-time high of $73,949 and towards $80,000. 

Bitcoin (BTC) price shows signs of a potential reversal but lacks confirmation, which has divided the investor community into two – those who are buying the dips and those who are expecting a further correction.

Also read: Bitcoin Weekly Forecast: BTC’s next breakout could propel it to $80,000

Bitcoin price crashes by double digits

Bitcoin price has dipped into the weekly imbalance, extending from $59,111 to $53,120, as mentioned in previous FXStreet publications, flashing a buy signal. But investors will likely get cold feet after a 15% crash in the past ten days. 

The recent dip into the aforementioned imbalance cleared the collected sell-side liquidity resting around the equal lows of $59,111, allowing sidelined buyers to accumulate. For a recovery rally to kick-start, BTC needs to form a base at around $60,000 and bounce back to the 2021 high of $69,138. 

Breaching the declining resistance level and connecting the lower highs formed since March 14 will confirm a breakout and the restart of a bullish trend. This development could propel BTC to a new all-time high (ATH) and eventually to the next key psychological level of $80,000. 

BTC/USDT 1-day chart

Also read: Week Ahead: Bitcoin could surprise investors this week

Should you buy BTC here? 

Previous publications forecasted a dip into the imbalance as a good zone to buy BTC. So, to answer the question, yes. Here are two reasons why you should pay attention to BTC at the current levels.

1. The risk-to-reward ratio is skewed. The upside for this trade idea is $80,000, a roughly 35% increase, while the invalidation level at $50,000 is 14% away. Investors with low-risk tolerance can cut the trade if BTC fails to recover above $61,150 or flips the $53,120 support barrier into a resistance level.
2. According to veteran trader and technical analyst Peter Brandt, if Bitcoin can hold the current lows around $56,900 and move higher, it could indicate a continuation of the bull market.

BTC Analysis by Peter Brandt

According to Santiment’s Whale Transaction Count (WTC), transactions worth more than $100,000 surged between April 29 and May 2, showing that institutional investors could have purchased BTC amid the recent price dip.

BTC WTC

The recent downturn in Bitcoin price saw a spike in social volume for terms such as “buy the dip” and “bought.” This index is also in line with what the WTC metric is indicating, adding credence to the potential reversal bounced discussed above.BTC social volume

All in all, the outlook for Bitcoin price looks bullish. As mentioned above, the invalidation level of $50,000 is a clear indicator of which side is in control. In case BTC flips the aforementioned key psychological level into resistance, it could trigger a 10% crash to the next critical weekly support level at $45,156. 

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