Bitcoin has been hovering in the range of $55k-$58k for more than a week. Some analysts were betting on its upcoming drop. However, the cryptocurrency managed to consolidate above $57.5k. Shortly after, the price subsequently began an upward movement. As of 18:00, the digital asset broke above the $58k mark, moving to $60k. Yet, it is still too early to open long positions. The quotes need to consolidate above several important levels to reap profit from long trades.
On the daily chart, bitcoin is steadily going up thanks to several important signals on the charts. The first of them is the formation of a bearish absorption pattern, followed by a downward movement to the key support level. At this level, a rebound occurred. As a result, on the daily chart, the bear triangle pattern appeared. Now, the price is successfully breaking through it. There are many short-term speculative positions in the range of $59-$60.5k. When traders close Profit Take orders, part of the coins will appear in the market. Therefore, BTC may face pressure. This is why it is quite risky to open long positions. If you trade for short-term purposes, it is better to enter the market when BTC is trading above the boundaries of the price movement channel. Now, it, is above $59K with the target levels to lock in profits at $59,000, $59,200, $59,350, $59,600, $60,000, and $60,500.
However, the main reason why it is too early to open long positions with a long-term perspective is the likelihood of a decline. BTC may rise to $62k amid strong bullish momentum. If it fails to break above this level, it may fall below $60k again. After that, it is likely to drop to $55.6k where the Fibonacci retracement level of 0.5 passes. Traders should bear it in mind if they want to become long-term owners of bitcoin or just make money on the current bull market. A decrease to $53.6k is also quite excepted within the bullish trend as indicated by the calmness of large holders. Glassnode analysts have the same opinion, reporting that whales continue to increase purchases.
For those who want to open long trades, keep in mind that BTC's growth is limited by the level of $62k. BTC could retreat from this level to $53.6k-$58.7k. Only after that, the upward movement will begin. Today, a false breakout of $62k may take place. The price may also slightly rise. However, after a pullback (which follows any bullish movement), BTC may fail to consolidate at $62k. Therefore, it is very risky to open long positions above $60k-$60.5 k as bulls are still lacking the strength to push BTC to $65.6k-$69k.
*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.
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