Yesterday was an intense day in the Bitcoin (BTC) markets, as a battle ensued at the $9,500 mark to both contain and support the bullish uptrend. As longs have accumulated on Bitcoin and funding rates have risen on margin exchanges, some bears clearly saw an opportunity to squeeze longs out of the market and take short profits – but this aspiration did not bear fruit, with bulls standing firm against aggressive selling.
We start on the hourly chart to see that the selloff, coming at about 16:00 (UTC), was bought up just at the trendline of an expanding triangle pattern that had formed. Bulls pushed the price all the way back up, and over 4,000 bitcoin worth of (leveraged) value changed hands in two hours on Bitfinex alone (about $34 million).
Price ultimately held at $9,500 after a counter-rally, and there is now a compression going on at just about the same level – and we are likely to again see movement soon.
Turning to the 4-hour chart, we again see a bullish expanding triangle sitting on top of a bull flag – and here, we might generally expect another move up.
However, we also see some bearish divergence coming in on the RSI, and a histogram pushed aggressively to the downside – although this histogram is showing a decelerating bearish contraction that should soon reverse. We may get a correction here and some consolidation, but it’s just as likely that we see another push up.
If we turn to a daily chart with dominance and longs/shorts, we can first highlight that Bitcoin’s dominance is falling even as price is rising. These are perfect conditions for the altcoin market, signaling a general rise market confidence – and indeed, alts are blowing up.
We can also note that both longs and shorts (on Bitfinex) are rising together. At first, longs were falling at the start of Bitcoin’s new uptrend, as traders took profits on their green long contracts; but now it looks like the market may be starting to expect a longer-term uptrend, rather than just a medium-term rally, and thus longs are re-entering.
Bitcoin has not looked this strong in a long time. On the LTF chart, we are likely to see a correction and consolidation sometime soon, either now or after another leg up. The medium-term looks very bullish, and the long term has changed to bullish – the long downtrend looks to be truly over.
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