What to expect if Bitcoin volatility drops over the weekend

Disclaimer: The information presented does not constitute financial, investment, trading or other advice and is solely the opinion of the author.

• Bitcoin hovered just above the $29,000 area.
• The short-term bullish and bearish strongholds were evident, but BTC’s next trend was not yet in place.

Bitcoin [BTC] bulls were rejected on August 8 from $30.2k. The price has since fallen, although it stalled at $29.4k over the weekend. It was likely that Monday’s highs and lows would produce a range that short-term traders can keep an eye on for the coming week.

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Bearish order blocks were present at $30.2k and $29.8k in the north. In the south, the recent lows have been an attractive area from a liquidity perspective. The higher time frame BTC price charts showed that $28.4k was critical for the bulls to defend.

The three-week Bitcoin range is expected to continue

Source: BTC/USDT on TradingView

Over the past three weeks, Bitcoin has traded between $28.8k and $29.8k levels. It rose to $30.2k once, but the bulls couldn’t hold onto their gains.

The RSI showed that momentum has been bearish since August 9 on the 2-hour chart. The indicator has climbed above the neutral 50 in recent hours, signaling a possible near-term sentiment shift.

This was supported by the volume indicators. The CMF climbed to +0.24 to highlight the remarkable flow of capital to the market. The A/D indicator also spiked up to underline an increase in buying volume. An upward movement was therefore possible.

The bearish order blocks (red box) of the H4 chart had not yet turned to support. Therefore, swing traders looking for buying opportunities can wait for a move back to $28.4k – $28.8k.

The Open Interest showed speculators exiting the market as BTC bounced off $29,000

Source: Coin analysis

In the early hours of Monday, August 14, there was a selloff that forced BTC to drop to $29.1k. Bitcoin bulls recaptured the level it was at before the drop within a few hours. Yet this bounce was accompanied by a drop in Open Interest.

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This showed that speculators with short positions were likely to close them during the profit slump. It also showed that sentiment remained bearish as bidders were absent during the minor recovery. The spot CVD also continued down.

Traders can look for opportunities at either end of the nearly month-long range. However, a drop below $28.4k could be followed by further losses. The next support levels to watch are $27.3k and $25.5k.