Bitcoin’s price rebounded by 3% following a period of continuous drawdowns since late January. After briefly dipping below the key $80,000 level on March 11, the leading cryptocurrency swiftly recovered, signaling renewed bullish interest.
With the U.S. core Consumer Price Index (CPI) coming in lower than expected at 3.1% on March 12, Bitcoin’s market structure hints at the potential for a sharp bullish reversal.
Bitcoin Liquidity Clusters Between $84K and $85K
Following Bitcoin’s price drop on March 9, the asset rebounded to test the critical overhead resistance zone between $84,000 and $85,000 multiple times. This led traders to aggressively accumulate short positions within this range, anticipating a rejection.
On-chain data from the liquidation heatmap indicated that over $300 million in short positions had accumulated in this zone. If Bitcoin were to break above the $85,000 resistance level, these shorts would be liquidated, potentially fueling further bullish momentum.
Furthermore, with minimal downside liquidity below $77,000, the likelihood of BTC targeting higher liquidity pools increases. If liquidations are triggered above $85,000, Bitcoin could establish a new higher high, turning this resistance level into firm support.
Adding to this bullish setup, an unfilled CME Bitcoin futures gap remains between $85,000 and $86,000 from the previous weekend. Historical data shows that all six similar gaps in the past four months have been filled, suggesting an increased probability of BTC flipping this resistance into a support zone.
Could Bitcoin Rally to $95K?
If Bitcoin successfully turns $85,000 into support, the next significant resistance lies at $90,000. A breakout past this level could liquidate over $1.6 billion in short positions, opening the door for a potential retest of $95,000—a move that represents a 12% surge from current price levels.
Market analysts remain divided on Bitcoin’s next move. Mark Cullen, a prominent Bitcoin analyst, acknowledged the potential for further upside but cautioned that the price action remains “corrective,” suggesting continued sideways movement before a major breakout.
Conversely, crypto analyst and funded trader Valeria pointed out signs of distribution near the $85,000 range, interpreting this as a short-term bearish signal. According to her analysis, Bitcoin may dip below $80,000 before initiating a sustained bullish breakout.
Binance and Coinbase Diverge on Order Book Trends
Market data reveals contrasting trends between major exchanges. On Binance, spot traders have been aggressively selling Bitcoin over the past few days, as reflected in data from Aggr.trade. This selling pressure was most pronounced during Bitcoin’s dip to local lows around $76,650.
Meanwhile, on Coinbase, spot buyers stepped in to place significant bids at these lower price levels, ultimately contributing to Bitcoin’s swift rebound above $80,000.
Conclusion
Bitcoin’s current price action suggests a delicate balance between bullish and bearish forces. While liquidity conditions favor a potential breakout above $85,000, market participants remain cautious about short-term downside risks. With a key resistance at $90,000 and a possible retest of $95,000, traders are closely monitoring liquidity movements and exchange order book trends to gauge the next big move in Bitcoin’s price trajectory.
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Disclaimer: The information provided in this article is for informational purposes only and should not be construed as financial or investment advice. Cryptocurrency investments are subject to market risks, and individuals should seek professional advice before making any investment decisions.
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