Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- Bitcoin flipped its daily market structure to bullish
- The defense of the $27k area is a key factor in gauging whether bulls possess enough steam to drive prices higher
Bitcoin [BTC] appeared to change its fortunes over the past three weeks. The drop to the range low of $24.9k on 11 September was followed by a rally that reached the mid-range resistance at $28.5k. The market structure was bullish on the 1-day chart- but can the bulls sustain this pressure?
Read Bitcoin’s [BTC] Price Prediction 2023-24
A Bitcoin price report from AMBCrypto dated 3 October noted the liquidity around the $27k region was an ideal place for prices to revisit. The insight from the liquidation charts proved accurate. The article also showed a move to $29k before a drop to $27k was possible for BTC, but this scenario didn’t pan out.
The revisit to a lower timeframe support zone could be followed by another leg upward for BTC
Source: BTC/USDT on TradingView
The range (orange) extended from $24.8k to $31.8k. The bullish order block at the range low prompted the rally, and the $26.2k short-term resistance was flipped to support as well. The next zone of interest was the bullish breaker block from the 4-hour timeframe, demarcated by the white box.
It stretched from $26.9k to $27.5k and was retested as support in recent hours. It was likely to witness a bullish reaction in the coming days, as the Relative Strength Index (RSI) showed bullish momentum was back. The structure was also in favor of the buyers.
The On-Balance Volume (OBV) on the daily chart saw little change since April given the relatively low trading volume, but LTF charts showed the OBV climbing higher. Combined with the price action, it seemed likely that BTC was headed toward $28.5k once more. A breakout past this level could see the king coin run toward the range high, but the resistance around $30k could be tough to break down.
For lower timeframe traders, another dip to the $27k level would present a good risk-to-reward buying opportunity.
The order book data showed significant buying pressure close by
Source: MobChart
MobChart data showed a $3.82 million limit buy order at $27k placed within the past 24 hours. It also noted a $3.12 million limit sell order at $28.5k set just hours before press time. The proximity of the buy order suggested it was likely that BTC could climb higher.
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Evidence from the order flow and the price action suggested that a bounce toward $28.5k was likely to occur. Whether Bitcoin can breach this resistance is unclear. If it does beat $28.5k, the $30k and $31.8k resistance levels would be the next areas of interest.
