Bitcoin Surged Above $91k — Will it Retest $94k Next?

Bitcoin dropped to a low of $88,463 a few hours ago. It soon rebounded and surged to a high of $91,122.

BTC is currently grappling with a slight correction and threatens to slip even lower in the coming hours. However, a closer look at price action over the last three days shows that this is the highest level the coin attained.

Additionally, the asset has registered progressively higher lows during this period. The setup suggests that the buyer is finally gaining a foothold in the market after several days of consistent decline.

Aside from Bitcoin attaining a new three-day high, it broke a key liquidation level. Over the last 24 hours, traders have opened new short positions with a liquidation price set around $90,900. If the apex coin broke above the mark, they would lose over $300 million.

The break above $91k results in the bears seeing losses exceeding $170 in the last 4 hours. The losses increase on the 24-hour scale as short positions worth over $213 million were rekt.

Nonetheless, the latest increase has triggered anticipation for further surges. However, several factors should be considered before concluding that the uptrend will continue.

Bitcoin Supply Still in Losses.

A recent report from Axel Adler noted that 71.5% of the total Bitcoin supply was in losses as of Thursday. Voicing his opinion about the profit index, Darkfost stated that the metric must climb above 75% to guarantee a sustainable uptrend.

At the current price, the supply in profit remains below the highlight threshold. Going by what he said, the recent surge above $91k may not be the start of the uptrend many expected.

Nonetheless, the chart above shows that the total supply recently reached 75% but was rejected, indicating that crossing 75% is not the only requirement to guarantee further increases. Instead, crossing the threshold would make investors more comfortable holding and would encourage new ones to buy.

One reason the recent uptrend failed was that traders viewed it as an opportunity to exit the market after holding in losses over the last three months. They were unconvinced about the surge, taking it as a relief rally.

Glassnode noted that the recent attempt at the short-term holders’ cost basis failed due to sell-side pressure from 3-6 month holders. Interestingly, this cohort’s CB is $112.6k, which means they sold at a loss as they feared further decline.

The market conditions at the time of writing are not different. Bitcoin’s latest rally has generated little buzz, as investors remain unconvinced. If market conditions remain unchanged and there are no fundamentals to dispel the bearish sentiment, the latest upward momentum will wane in the coming days.

Nonetheless, since flipping the level with significant short position liquidations, the apex coin may advance slightly higher before corrections hit. The liquidation heatmap shows that the next level with liquidation concentration is $93,500.

Away from onchain data, indicators are yet to react to the latest increases. For example, the moving average convergence divergence had a bearish crossover a few days ago. It continues to decline, suggesting the bulls have yet to fully dominate the market.

The biggest test for the bulls will be to sustain the recent upward momentum over the weekend into the new week. 

The post Bitcoin Surged Above $91k — Will it Retest $94k Next? appeared first on CoinTab News.