Can Bitcoin and Ethereum survive this scare?

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After three days of sustained recovery, Bitcoin and Ethereum again came under heavy downward pressure as Ethereum hit a value near its recent low of $ 1,700. For Bitcoin, the asset was just above $ 30,000 at the time of publication as fear loomed over a new low in the sector. As the markets slowly turned lower in the long term, the direction was still not identified in the short term.

In order to identify areas of falling or a possible recovery to come, we looked at the map of active sell-offs to understand current traders expectations.

Liquidation pool at a higher range for Bitcoin, Ethereum?

While the bears have the advantage for now, Bitcoin, Ethereum prices remain in a range, which could be a potential bottom before the price goes up. Now, as the possibility decreases with each passing day, the data shows more liquidity is appearing at higher prices.

The importance of liquidity during these periods is high because the price action follows pools of capital. So whenever orders are set in an upward or downward direction the price gets closer to that value over time and once the price gets closer to those mutual funds traders usually add more than that value. margin or liquidate their positions.

Source: Twitter

Source: Twitter

Now when analyzing the attached chart for Bitcoin and Ethereum it was identified that Ether had a strong capital range at $ 2,200. Likewise, there was also an area of ​​high liquidity between $ 1,700 and $ 1,800, an area where the coin resided at press time. The inference that can be drawn from this narrative is that Ethereum could potentially reverse this range as the price action will be drawn into the liquidity pocket.

The same applies to Bitcoin, a huge pocket of liquidity was observed in the range of $ 36,000 to $ 39,000 with 1.3k Bitcoin.

So, is he likely to go over the top yet again?

At the time of going to press, Bitcoin Futures’ 3-month sliding base had suffered a strong reset on Binance and Deribit, a finding that meant that the spread between the spot and the futures had narrowed. Now it has come down without a massive drop over the past few days, so there might be more freedom for price movements.

BTC / USDT on the trading view

However, Bitcoin is playing with fire right now as its weekly candle ends just above the demand zone. The support range of $ 28,130 to $ 30,130 has been held since early 2021. Failure to meet that level next week would open the floodgates and the bulls would be brought down under downward pressure.

Right now, it is imperative that Bitcoin closes the weekly candle above $ 30,130 within the next 24 hours, and the next candle must not retest the aforementioned demand zone. As we move into the third quarter of 2021, things may start to heat up for the market, but time is running out and the market needs to respond quickly.


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Rodney Carroll

Rodney Carroll