Bitcoin broke key support levels on Nov. 18 to retest the bulls’ resolve.
Data from TradingView shows that BTC / USD is losing support at $ 58,400 after several retests in the previous days, and at the time of writing, Bitcoin is trading at $ 57,446.
Despite the high volatility and challenge of the $ 60,000 mark, the price has fallen to $ 56,550 in the last hour – its lowest level since October 15.
“There is a massive sell-off across the market,” wrote analyst Rekt Capital in his latest Twitter update.
“The selling pressure will undoubtedly ease. Be on the lookout for short-term, high-selling volume bars. These bars tend to indicate a low point after a continuous sell and before a strong rally or a complete trend reversal. “
Seller burnout was the typical atmosphere in mid-September, right after Bitcoin dropped $ 10,000 in a single daily candle.
Similarly, the November 18 move resulted in a noticeable reversal in the Output Return to Spending Ratio (SOPR), a key metric in determining oversold periods.
Bitcoin SOPR chart. Source: Glassnode
With the general narrowing of the range, the discussion has turned into a potential short squeeze aimed at driving up spot prices.
“Based on the structure of the futures market, the trends in funding rate and OI momentum provide a perfect backdrop for a ‘short squeeze’ scenario. Then the question arises, which price range should serve as support? ”An employee of the chain analysis company CryptoQuant To write On Wednesday.
Investors buy dips
At the time of writing, Bitcoin is still in the process of hitting a monthly low.
For analyst Michaël van de Poppe, $ 56,000 is the end point for the recovery.
“If that’s the case, a relief rally could be imminent.”
Willy Woo is more optimistic and sees long-term dip buying as a sign that the general downtrend is far from reality.
I guess that’s what I call “buying the dip” pic.twitter.com/57kmAtycGF
– Willy Woo (@woonomic) November 18, 2021
Bitcoin’s illiquid supply is in a similar situation and increasing significantly as the price decline during this week shows strong buyer interest.
According to Cointelegraph