Cryptocurrency markets will likely stay under sell pressure for the next few weeks, but data points indicate this bear market may be short-lived.
Philip Gradwell of Chainalysis said on CoinDesk TV that “relatively little” ether was bought above $1,850 and even less was bought at $2,000 or above.
The oldest cryptocurrency is looking at a price support level around $54,000, with resistance around $60,000.
Bitcoin traders are increasing their bullish bets in futures markets – and taking more risk.
$60K is a key psychological level that has also proven a formidable stopping point during this year’s powerful rally.
The quick recovery to near $58,000 demonstrates stronger confidence from investors in the oldest and largest cryptocurrency.
After two days of sell-offs, bitcoin bulls finally returned.
“This is a time to make sure that you have some dry powder and are not overextended,” said one trader.
More bitcoin may be getting HODLed, blockchain data shows.
Tesla got the market excited briefly, but bitcoin is still in consolidation mode.
“The market is not as confident anymore,” say Arcane Research. “More traders are positioned short.”
As of March 21, there were fewer than 2.44 million BTC available on exchanges, the lowest amount since August 2018.
Price charts also are sending signals the oldest cryptocurrency might be losing steam.
Bitcoin's price has doubled this year, partly because of demand from institutional investors who are looking for an asset that might hold its worth if the dollar’s purchasing power declines.
Prices settled in the mid-$50,000 range for the most of Tuesday.