A popular cryptocurrency trader on the social media platform This prediction is based on the liquidity dynamics that have driven the price of the major cryptocurrency over the past few weeks.
Bitcoin market structure indicates more volatility in the future
In a post dated April 4 on the X platform, KillaXBT open Possible paths that Bitcoin price could follow in the coming weeks. Cryptocurrency traders’ analysis is based on the current technical structure of BTC, noting multiple support and resistance levels visible on the weekly time frame.
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The analyst explained that the past few weeks have seen investors see multiple sweeps across external highs and internal lows. More precisely, the sequence appears to have started about four weeks ago with a sweep of the outer range highs, which in turn led to a quick reversal in Bitcoin price – ultimately leading to a bearish weekly close.
KillaXBT explained that because of this move, Bitcoin had to find balance again; This took the weekly candle for the major cryptocurrency back towards $71,500. Interestingly, this move was made with clear intent Sweeping short positions latebefore prices reversed to the downside again – a move KillaXBT referred to as the classic liquidity hunt seen before reversals.
As last week’s candle closed lower, the cryptocurrency expert highlighted another noteworthy event; This week also swept up some liquidity (another rebalancing event). Obviously, what followed this sweep was another bearish rejection of the BTC price.
However, since Bitcoin’s recovery is largely driven by leveraged positions, and with the market structure already bearish, KillaXBT points out that Available buying pressure They may be exhausted soon. As such, the lows at $64,900 appear vulnerable to another liquidity sweep.
In the medium term, the technical analyst also sees Bitcoin breaking the outer range lows at $63,000. On the other hand, quantitative analysis in the market highlighted that this downtrend is in line with expectations of an immediate reversal towards $72,800, where another selling move is waiting.
Short-term bearer activity supports near-term bearish sentiment
And in another post on X, on-chain analyst Joao Wedson subscriber There has been a noticeable shift in behavior among short-term participants in the Bitcoin market, with data indicating that this group is increasingly unloading their holdings. The relevant indicator here is a measure of the net short-term change in a shareholder’s position.
This investor group typically includes investors who have held Bitcoin for less than 155 days. As such, they are often more reactive to sudden changes in price action, unlike more experienced market participants.
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Thus, the activity of these new owners can actually reveal a change in sentiment (in this case, a bearish change). When this happens (impulsive selling activity), the price of Bitcoin often heads south, as these sales contribute to downward pressure.
Thus, the world’s leading cryptocurrency could actually be heading towards $63,000 in the near term, at least before seeing any real recovery attempts. As of this writing, Bitcoin is trading at around $67,256, reflecting 0.5% growth in the past day.
Featured image from iStock, chart from TradingView
