Bitcoin (BTC) made a recovery above $29,000 on August 8th, with one trader noting a potential breakout already in progress. This resurgence followed a modest rebound after Bitcoin reached local lows of $28,670.
During the August 7th Wall Street trading session, Bitcoin correlated closely with the performance of United States equities. Despite lacking enduring momentum in any particular direction, market participants were on the lookout for signals indicating a return to a trend.
Popular trader Jelle identified a potential falling wedge breakout on daily timeframes. Jelle’s analysis suggested that this formation had a target price of $32,000, but questioned whether Bitcoin could overcome the key resistance.
The falling wedge pattern began at the start of July and marked Bitcoin’s second such formation in the span of two months, with the previous one occurring from April to June.
Another trader, Michaël van de Poppe, referred to the previous day’s downside move as a “standard correction” and highlighted the upcoming July print of the U.S. Consumer Price Index (CPI) as a potential catalyst for cryptocurrency market volatility.
On intraday timeframes, the market presented a mixed picture as market makers and takers engaged in a tug-of-war on exchanges.
Trader Skew explained that the failure to break down Bitcoin’s price forced spot takers—who had initially led the sell-off—to become buyers, thereby providing support around the $29,000 level.
In a more optimistic market analysis, Yann Allemann and Jan Happel, co-founders of on-chain analytics firm Glassnode, argued that the dip below $28,000 held more significance as a local bottom than many realized. They referred to Bitcoin’s Risk Signal metric which indicated that the cryptocurrency was at its most “high-risk” trading level in several months.
Coupled with a neutral signal on altcoins and overall low volatility, Glassnode suggested that the market was primed for bullish traders to enter. They stated that while bears remained in control, they were becoming exhausted, and Bitcoin was on the verge of being oversold. The analysts identified a liquidity pool demand around $28,500, which could potentially trigger a reversal.
It’s important to note that this article does not provide investment advice or recommendations, and readers should conduct their own research and analysis before making any decisions.
In conclusion, Bitcoin experienced a recovery above $29,000 on August 8th, with traders evaluating the possibility of a breakout. The market showed mixed signals on intraday timeframes, and analysts suggested that the dip below $28,000 could be a local bottom. Overall, there was cautious optimism that Bitcoin was close to being oversold and could potentially see a reversal in the near future.
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