A widely followed crypto analyst says market behavior signals a breakout to the upside for Bitcoin (BTC).
In a new thread, pseudonymous crypto strategist Credible Crypto tells His 349,500 followers on social media platform
“We’re about halfway to my ideal downside target. However, we are now seeing a number of shorts building towards our range highs (a logical support level) and the bid side of Binance perps are stacked more heavily than the demand side.
Shorting the support while the bids wait stacked is usually a recipe for a price drop/return to the upside. Will overeager shorts cause us to hit my ideal downside target? Stay tuned to find out.”
According to the crypto trader, the statistics are to suggest that short sellers will try to drive down the price of Bitcoin but will ultimately fail. He points to a collapse in the cumulative volume delta (CVD), an indicator that aims to detect differences by comparing buying and selling volumes over a period of time. Credible says the price remaining stable despite falling CVD indicates a large entity is absorbing the selling pressure.
“The last week during this tight consolidation: OI (open interest) is relatively flat – meaning you don’t see a huge build-up of new [leveraged] positions.
Meanwhile, spot CVD has been dumping, implying that spot holders have been selling aggressively into the market.
However, [the] price won’t go down. This means that an entity absorbs all these spot sales with passive/limit bids.
What does it mean if the aggressors (sellers on the spot market) put a lot of effort into lowering the price, but get little or nothing in return?
Bitcoin is trading at $34,639 at the time of writing, up fractionally over the past 24 hours.
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Generated image: Midjourney