- Bitcoin could remain bullish until it trades above $45,000.
- If BTC falls to the $54,700 level, long positions worth nearly $2 billion will be liquidated.
After a huge price crash on August 5, the market is now recovering. Top assets like Bitcoin [BTC]Ethereum [ETH]and Solana [SOL] have experienced significant price increases over the past two days.
Amid this ongoing price recovery, Julio MorenoCryptoQuant’s head of research informed that Bitcoin was showing a bear signal.
Bitcoin flashes bearish signal?
In a post on X (formerly Twitter), Julio mentioned that the bull-bear market cycle indicator has entered a bearish zone. This is the first time since January 2023 that this indicator has given a bearish signal.
According to historical data, the same indicator showed bearish signals during the market crash in March 2020 and May 2021.
As we retweet Julio’s post, Ki Young Ju, the founder and CEO of CryptoQuant, shared on X that Bitcoin could remain bullish until it trades above $45,000. In one message he noted:
“Some indicators are showing bearish signals. However, they can still recover with a rebound, so we have to see if it stays at this level for a week or two. If the period lasts longer, the risk of a bear market increases, and the recovery could be difficult if it lasts longer than a month.”
At the time of writing, BTC was trading above the $57,200 level and experienced a price increase of over 4% over the past 24 hours. Despite this impressive price increase, trading volume has fallen by 38% over the same period.
This massive drop in trading volume signals fear among traders and investors.
Bitcoin technical analysis
According to expert technical analysis, BTC seems bullish and it could rise close to $60,000 in the coming days.
$60,000 will be the crucial level for BTC as it faces resistance from the trendline and the 200 Exponential Moving Average (EMA).
Source: TradingView
However, if BTC manages to break this resistance level, there is a good chance that we will see a massive upward rally towards $70,000 in the coming days.
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Right now, the key liquidation level is almost $54,700 on the low side, and if sentiment changes and falls to that level, long positions worth almost $2 billion will be liquidated.
Source: Coinglass
While at the top end, the largest liquidation level is almost $58,000. If sentiment remains unchanged and BTC rises to that level, nearly $500 million in short positions will be liquidated.