Bitcoin (BTC) back above $69,000 – but will it last?

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As a researcher with experience in the crypto market, I believe that Bitcoin’s current price action is a complex interplay of liquidity, institutional demand, and technical resistance levels. The fact that Bitcoin has been trading within a range for the past 12 weeks has made it challenging for new retail investors to hold on to their positions due to the choppy price movements. However, I also observe that there is still ample liquidity entering the system through various channels, such as institutional inflows and potentially from China’s central government.

As an analyst, I’ve noticed that Bitcoin regained its footing above the $69,000 mark during Monday’s early trading session. However, the question remains: will this be a significant breakout or just another minor fluctuation within Bitcoin’s established trading range over the past 12 weeks?

Liquidity

The volatile and somewhat erratic movements in the price of Bitcoin ($BTC) may make it challenging for new retail investors to maintain their position with confidence. However, the number of retail investors actively participating in the crypto market is still relatively small. Many more are likely to join later at higher prices, potentially supplying the market with the liquidity needed for experienced traders to sell their holdings.

As a crypto investor, I’d say: Despite the possibility of continued higher interest rates from the Fed this year, I remain optimistic about Bitcoin ($BTC). The market still sees inflows of liquidity, albeit through indirect channels, and there are signs that China’s central government might add more.

14 straight days of institutional inflows

From an institutional perspective, US Bitcoin Spot ETFs have seen uninterrupted inflows for the past two weeks, resulting in a significant increase in their holdings. The recent four-day period has witnessed modest investments, but on all but one occasion, the daily net inflow of Bitcoin exceeded the usual 450 BTC mining production.

$BTC price meets resistance at $69,000

Within a brief hourly time span, Bitcoin’s price surged to touch a new height above $69,000. Yet, this peak intersected the top of the tiny triangle formation and hit the significant resistance level at this price point. Consequently, it’s plausible that Bitcoin could bounce back down to the triangle base, which would reset the short-term RSI momentum indicators based on stochastic oscillation.

A catalyst to break $71,300

Source TradingView

At a daily scale, it’s observable that Bitcoin’s ($BTC) price continues to move within its established trading range, which includes the bull flag pattern. A potential break of the mini bull pennant could trigger a surge in price, enabling it to surpass the bull flag’s peak and the resistance at $71,300. Should we experience a decline instead, the support levels of $67,000, $64,000, and $61,000 will likely prevent further depreciation.

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2024-06-03 14:08