- Coinbase Premium Index turned positive, signaling renewed U.S. investor interest.
- Bitcoin nears key resistance within a descending channel.
- Analysts debate Bitcoin liquidity as long-term holders accumulate.
Bitcoin’s price has shown volatility in recent weeks, fluctuating between $79,000 and $95,000. It experienced sharp declines followed by partial recoveries. Recent trends indicate a gradual rebound, with Bitcoin currently trading between $85,000 and $90,000. Short-term metrics reveal a 1.7% decline in 24 hours.
However, the crypto remains up 2.3% over the past week and 5.4% over 14 days. Over the past 30 days, Bitcoin has dropped 8.2%, suggesting a correction following recent highs. Still, it has gained 23.8% over the past year, maintaining a long-term bullish trajectory.
Coinbase Premium and Its Potential Impact
CryptoQuant recently reported that Coinbase Premium Index has been fluctuating around zero. Sentiment changes of U.S. traders are captured in this index. The index has recently begun to move into the positive territory, and this might show that Bitcoin is once again eyed by users on Coinbase.
Throughout its history, the analyst noted that a positive Coinbase Premium has correlated with upward price momentum. Generally, when U.S. investors have increased demand, it strengthens global market confidence.
In any case, CryptoQuant said that other market indicators like trading volumes and on-chain data should also be observed for a clearer picture. A turning away from negative territory may suggest a bullish turn, yet industry sentiment is vulnerable to any outside factors.
Key Resistance Levels
A technical chart from Captain Faibik presents an analysis of Bitcoin against Tether on a daily timeframe. The chart outlines a descending channel, with Bitcoin forming lower highs and lower lows since its recent peak. The resistance and support zones align with the upper and lower trendlines of the channel.
Bitcoin is currently near the upper boundary of the descending channel. A developing ascending wedge within the downtrend suggests a possible breakout above resistance. If Bitcoin surpasses this level, it could trigger a strong bullish rally. The analyst noted that Bitcoin short positions could be squeezed, allowing bullish momentum to build.
April appears positioned for a Bitcoin price increase, with the potential for new all-time highs. A forecast places Bitcoin’s next peak at approximately $109,000. However, resistance levels remain critical, and price action will determine the next phase of movement.
Perspectives on Liquidity
Market liquidity and capital inflows have been central topics in recent discussions. Analyst Axel Adler Jr addressed reports suggesting a decline in Bitcoin market liquidity, stating that such conclusions are inaccurate.
According to him, Bitcoin’s Realized Capitalization growth, which stands at 0.6% per month, signals a slowdown in new capital inflows but not a decrease in liquidity. The realized capitalization figure has been increasing since April 2023 and now stands at approximately $866 billion.
At the same time, Altcoin Sherpa observed that Bitcoin has continued to test $89,000, making it possible for it to spike up towards $90,000s before falling. He further stated that the other possible scenario here was Bitcoin extending higher, then re-entering its previous range.
Glassnode also added that short term Bitcoin holders are facing increasing financial pressure. However, it seems long term holders have been accumulating, shipping wealth in the direction of price insensitive investors. The existence of this trend indicates that Bitcoin ownership is gradually transferred to the holders with longer investment horizon, which will stabilize Bitcoin price in the long run.
