Cointelegraph Team
Cointelegraph
The price of Bitcoin (BTC) is attempting to break the $60,000 resistance level after more than a week of ranging.
Whale clusters show that $57,046 and $60,045 are the crucial support and resistance areas in the short term.
In other words, the probability of a strong breakout in the foreseeable future would increase substantially if Bitcoin stays above $57,046 and continues to test $60,000 resistance.
Why whale clusters are important for Bitcoin
Whale clusters form when high-net-worth investors buy or sell Bitcoin at a certain price and do not move their holdings thereafter.
As such, a whale cluster support typically serves as a strong macro support area for Bitcoin because whales tend to buy more when BTC falls to a level where they initially bought BTC.
On the flip side, a whale cluster resistance area would likely hold up as a sell area because whales are more likely to wait until their breakeven price to sell their positions.
According to researchers at Whalemap, the two key resistance levels for Bitcoin in the near term are $60,045 and $61,062. On Wednesday, the researchers noted:
“$BTC is back. Bouncing perfectly from whale supports so far. This is a good sign: in bear trends, whale resistances work better than supports and vice versa for bull trends. Whale supports are back to business now which means the trend has shifted. April should be quite fun.”
Bitcoin whale clusters. Source: Whalemap
Since then, the price of Bitcoin has been ranging and consolidating between the resistance level and the $57,000 support.
Based on this trend, the researchers added that this could be the calm before the storm, anticipating a spike in Bitcoin’s volatility, which is currently at the lowest levels since November 2020. They wrote:
“The support resistance battle is intense. Levels from last week are working pretty well. Bitcoin is being capped by the $60,045 level pretty spot on. Is this the calm before the storm?”
Traders’ sentiment about Bitcoin is mixed
According to the pseudonymous trader known as Byzantine General, the Bitcoin futures market is becoming extremely overheated.
The derivatives market is surging while the BTC futures funding rate is consistently spiking above 0.12%.
On average, the default futures funding rate of Bitcoin is 0.01%, so the market is overheated by around 12-fold. The trader said:
“This looks pretty bad tbh. A good flush would be a blessing.”
Bitcoin price chart with futures funding rate and volume. Source: TradingView.com, Byzantine General
A trader known as NekoZ stated that the technical market structure of Bitcoin on the 4-hour chart indicates that BTC could consolidate longer, but he is not bearish in the near term.
The trader said
“BTC - H4. I see no reason to be bearish on bitcoin. 2 points I am adding to my long. As long as we keep showing higher lows, 0 reason to be worried.”
Traders generally echo the sentiment that Bitcoin could see a minor pullback to reset from the overheating derivatives market, but the macro technical structure remains optimistic.
Latest Crypto News & Analysis
Editors’ Picks
Three reasons why SafeMoon price might rally 60% soon
SafeMoon price has experienced a massive sell-off since June 15 as it deviated below its previous range low established on May 23. However, this deviation is likely to revert to the mean, providing an excellent opportunity for an uptrend.
Ethereum targets $2,400 before facing next hurdles
Ethereum price made a lower low on June 22, plunging below the $1,732 mark recorded amid the May market crash. While ETH price action followed the leading cryptocurrency as it faced recent negative news headlines, including China’s ban on digital assets, the second-largest crypto is heading for a swift recovery.
Bitcoin price to rebound, but BTC has not reached a market bottom yet
BTC price dips below $30,000 for the first correction this month. Chinese regulations are panicking crypto investors with mining bans. Stock markets push higher, leading to the potential return of risk sentiment for continued BTC buys.
Dogecoin comeback might propel it up by 26%
Dogecoin price slid below the May 19 range low to create a new bottom as the entire cryptocurrency market underwent a sell-off. Although DOGE has rallied considerably since setting up the recent swing low, more gains seem to be on the horizon.
Bitcoin Weekly Forecast: Markets revert to mean, but BTC price remains indecisive
Bitcoin price shows considerable strength after springing from the recent crashes. Still, it is uncertain whether the current bullish impulse will morph into a new uptrend or lead to a more profound decline.