This week’s drop is not “convincing,” analyst Filbfilb says, echoing others’ misgivings about the likelihood of a short-term bullish continuation.
$56,760 “not a convincing bottom”
After sliding 5% on Wednesday, BTC/USD saw only a modest rebound to circle $57,000 at the time of writing, Cointelegraph Markets Pro and TradingView showed.
Following multiple failed attempts to crack resistance close to all-time highs, analysts were becoming wary of a further dip and a temporary halt to further price gains.
Filbfilb, co-founder of trading suite DecenTrader, described this week’s current floor of $56,760 as “not a convincing bottom.”
As reported on Wednesday, funding rates among trading platforms call for a shakeout of leveraged long positions from those overly bullish on a continuation. For Filbfilb, those rates remain “way too high,” he told subscribers of his Telegram trading channel.
Popular Twitter trader Cantering Clark, meanwhile, pointed to Bitcoin’s 20-week moving average (MA) — a classic “line in the sand” for price performance — still lingering at around $40,000.
“More fuel for why I think April-May puts a lid on $BTC until later in the year,” he commented on a comparative chart.
“Simple as it is, this 20 week MA with a 2 standard deviation band above. At some point, these meet. Either it comes to us or we come to it. Hard to imagine this takes plus much higher up.”
Macro turns favorable for Bitcoin bulls
Despite institutional interest continuing in recent weeks, fuelled by major new adoption announcements from banks, signs of a slowdown were also beginning to show on the day.
The Purpose Bitcoin exchange-traded fund saw a slight reduction in its BTC holdings after consistent growth, with its assets under management dipping in tandem from highs of $976 million to $944 million.
Fellow institutional portal Grayscale Bitcoin Trust (GBTC) maintained its negative premium, meanwhile, a phenomenon that has put pay to further Bitcoin accumulation since February.
But not everyone was wholly gloomy. For trader Crypto Ed, the ultimate market trajectory was clear.
“Not in a rush to get in a position,” he told Twitter followers on Thursday.
“54k first or up from here, both mean we’re starting a strong 3rd leg and plenty of upside waiting for us. BTC will break 60k and finally go much higher.”
Beyond crypto, a buoyant outlook for United States stock markets coupled with a weakening dollar could further serve Bitcoin’s purpose in the short term.
“With excess savings, new stimulus savings, huge deficit spending, more QE, a new potential infrastructure bill, a successful vaccine and euphoria around the end of the pandemic…U.S. economy will likely boom,” noted JPMorgan CEO Jamie Dimon in his annual shareholder newsletter earlier this week.