Disclaimer: The results of the following analysis are the sole opinion of the author and should not be taken as investment advice
- Bitcoin’s market structure has been bullish on the daily chart
- Risk-averse traders can wait for Bitcoin’s reaction over the next two days before formulating their trading plans
Bitcoin dipped into an area that bulls recently flipped to support. The weekend was characterized by low trading volume and little volatility. Anticipation of the Federal Reserve rate announcement meant that any positive news could lead to a small BTC rally.
This idea could be shattered if the economic news is even slightly negative, as this can trigger a wave of panic in the market.
Read Bitcoins [BTC] Price prediction 2023-24
As of Nov. 10, Bitcoin has been trading in a range of $15.6k to $17.6k. At press time, the crypto king hovered near mid-range. Risky conditions over the next few days allow traders to sit back and weather the volatility.
The confluence of midrange and bullish breaker indicated that bitcoin could see a bounce towards $17.6k
Source: BTC/USDT on TradingView
The $17.4K and $16.7K levels represent the high and low of last week’s trading, respectively. Meanwhile, the region highlighted in cyan showed a former bearish order block that was breached on Nov. 30.
After being hit, it flipped to a bullish breaker and represented a region where buyers were likely to be strong. To complement this idea, Chaikin Money Flow (CMF) has been above +0.05 for the past few days. This was at a time when Bitcoin was holding on to the $17,000 mark.
However, it was clear that Bitcoin’s strong downward trend in recent months was still unbroken. To the north, stiff resistance levels lie at $17.8K and $18.6K. The $18.2k-$18.5k also presented a zone of liquidity where the bears can attempt to reverse any rally.
The Relative Strength Index (RSI) was recently at neutral 50 and the price has not had any noticeable momentum on the higher timeframes. That could change later this week. A move back above $17.3k would herald a bullish bias on a lower timeframe and a move above $17.8k can be used to aggressively take profits. Meanwhile, a drop below $16.6k would likely be followed by another 6% drop to the range lows.
Exchange withdrawals hit yearly highs in November
Source: Glassnode
Total on-chain withdrawals from exchanges totaled 106,450 BTC as of Nov. 9. Also on November 14, this number reached 108,221. Both values are significantly higher than anything Bitcoin reached in 2022. Did this indicate that whales were licking the blood on the streets after the FTX collapsed?
All in all, Bitcoin may or may not have bottomed out. Traders and investors still need to be cautious as the trend on the higher time frame has been bearish. Risk management and capital preservation are extremely important, especially in the depths of a bear market.
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