- Spot ETF demand, whale activity, and realized price meant BTC has room for further gains
- A lull in the uptrend may be likely for a few days, giving time for liquidations to build up overhead
Over the past 48 hours, Bitcoin [BTC] has fought to seize control of the $94k-mark, but without success yet. This was the same level that BTC bounced to in early March as the chances of a U.S Bitcoin Strategic Reserve grew. Just a few days later, President Trump passed an Executive Order.
At the time of writing, the price was just above the short-term holder’s realized price, which signaled that the market was not yet overheated and had room to grow. A rapid hike in whale transaction activity and reduced retail activity meant that a swift upward move could be brewing.
At the same time, the hike in inflows to spot exchange-traded funds (ETFs) have been hugely encouraging.
The nearly 12k BTC net inflows recently marked the largest single-day influx since 11 November, and was 500x above the yearly average net inflow of 23 BTC. The bulls have been growing more confident too.
Reasons why Bitcoin could surge higher after a week’s pause
Source: BTC/USDT on TradingView
The 4-hour chart reflected strong bullishness. The CMF was at +0.29 to signal heavy capital inflows and buying pressure. The OBV was also on an uptrend over the past two weeks – Another sign of steady demand.
The RSI has tapered off over the past couple of days as Bitcoin struggled to surpass the $94k resistance. The $92k-level represented the lows of a range formed earlier this year. Hence, BTC could oscillate between $92k-$94k for a few more days to consolidate.
Source: CryptoQuant
CryptoQuant analyst Maarten pointed out in a post on CQ Insights that April saw $1.049 trillion traded in the Binance Futures market – The largest figure since January.
This implies a hike in market participant interest, something that could fuel further market-wide gains.
Source: Coinglass
The high Futures volume meant that the liquidation heatmap could offer key insights into what Bitcoin could do next. In mid-April, we saw BTC hover around the $85k-$86k region. During this time, the density of short liquidations around $88k-$89k was growing.
After allowing the liquidity to build up, BTC soared higher, and the resulting short squeeze added to the buying flurry that sent the price higher. Over the past couple of days, a similar consolidation around the $92k-$94k might have begun.
Hence, it is likely that the ongoing consolidation could take another week, and allow liquidations to build up at $96k. In this scenario, another move higher to sweep this liquidity would ensue as the price is attracted to liquidity. This move could hit $100k, the round number psychological resistance, or $103k, the next sizeable liquidity cluster.
Hence, traders can be prepared for further gains after a few days of consolidation. The clues from whale demand, greater Futures volume, and Spot ETF inflows suggested bullish dominance would likely continue in the short term.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion