The first cryptocurrency confidently bypasses local resistance lines. Over the past day, the asset has risen by 2% with a modest daily trading volume of $20 billion. The total capitalization of bitcoin has reached $610 billion. The coin is confidently moving up, as evidenced by technical indicators. Despite the positive of the last few days, the baggage of negativity that has been accumulating for two months makes itself felt and may negatively affect the further movement of the asset's quotes.
The bearish sentiment in the cryptocurrency market peaked on July 20, when the value of bitcoin dropped to $29,300. This is the lowest figure that BTC has reached since January 2021. And despite the fact that the cryptocurrency bounced to the nearest support zone in the region of $31,200, bears continue to put pressure on bitcoin and can provoke a powerful collapse of the asset.
As of 11:00 UTC, bitcoin is quoted in the area of $32,400, trying to gain a foothold above the resistance zone of $32,500. In the coming hours, the asset will try to overcome the upper border of the local bearish flag. Despite the pessimistic impulses on the 1-hour chart, there is every reason to believe that bitcoin will be able to break through an important line of resistance.
However, subsequent resistance zones can be more difficult due to the negative market reaction to a rebound in bitcoin. Due to the too prolonged fall in BTC quotes, negative and neutral funding rates remain on the market. This indicates the skeptical sentiment of the audience, which does not believe in a bullish breakout in bitcoin and is betting on its further decline. The increase in the number of sell options and short openings puts pressure on the BTC/USD quotes, but buyers continue to push the price up. If the bulls manage to complete the breakout, then the bears should stock up on honey and something stronger.
The break of the main line of resistance will mark the mass liquidation of shorts that opened during the two months of the depression and triggered a negative funding rate. Further movement of bitcoin will be aimed at a breakdown of the important level at $36,000, which will allow the asset to get out of the correction zone. If by this moment the market positively perceives the next rise of bitcoin, then the next target will be the level of $40,500 and further movement to the last line at the indicator of $47,500.
The technical indicators of the cryptocurrency indicate a serious possibility of such a development of events. At the same time, on the four-hour chart, bitcoin is confidently moving along the line of downward resistance, and the asset only tried to break through this mark four times. Close to this line, at around $33,000, a corrective level is concentrated, which also puts pressure on the coin. As a result, BTC is on the verge of breaking through the area where two resistance levels intersect. The crypto asset has already begun to weaken, as indicated by the bearish divergence on the MACD and RSI indicators.
However, a significant drop is unlikely to occur, since, in the range of $30,500-$32,000, bitcoin has formed three support zones ($31,500, $31,200, and $30,600), after which the coin will return to growth. Despite the presence of bearish impulses, the number of bitcoin buyers continues to grow. The number of medium-term buyers continues to grow, which ensures the buyout of the volumes required for growth. If the upward trend continues for several days, then the main target for growth will be the area near $35,900, where you can carry out the initial profit-taking.
If bitcoin fails to break through the downward resistance line, then a rebound beyond $30,000 may occur. This is evidenced by the growing volumes for sale, which will soon be too much for buyers. This will increase the pressure on the BTC quotes, and, given the situation of recent months, the market will undoubtedly support the bearish movement. An additional advantage of the bears is also the statistics of BTC on-chain indicators, which are gaining momentum as the volatility of the asset falls.
In addition, the pressure from the launch of Grayscale Bitcoin Trust sales, which medium-term buyers are trying to level out, does not decrease. However, judging by the charts, the bulls are beginning to give way to the bears and, given the volumes of coins allowed for sale, they will not leave any chance for medium-term investors.
The only hope here may be the whales, which will buy out the entire supply of the market. As of 12:00 UTC, the cryptocurrency continues to move up, but the selling pressure is increasing. This is evidenced by the statistics of the ratio of sell and buy options. According to the study, traders do not see a chance for bitcoin to reach its all-time high in 2021, which indicates a rapid rise in sell options.
Therefore, the chances that the asset will still not be able to break the important line are quite high. In this case, a fairly rapid collapse to $30,000 and further movement to the level of no return at around $29,100 awaits us. If the bearish trend continues and this line is passed, the asset risks sinking to $24,000, where everything will depend on the market reaction.
