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Bitcoin has experienced a correction down to $23,000 over the weekend; with the recent downtrend, the Bitcoin price action needs a significant push above its resistance to confirm a continuation of the bullish trend that began in early 2023.
BTC has recently held above the $22,700 level, preventing further price declines. After a full-throttle uptrend since January, BTC has seen a correction to low levels since last week, dropping to $22,700. BTC succumbed to the selling pressure.
With the current price action of BTC and the uncertainty of the direction of the next move of the largest cryptocurrency in the market, the total amount of liquidations data has increased over the past few days, with almost $200 million in positions liquidated since February 22nd, according to Coinglass data.
Is A Bitcoin Bull Trend In Full Effect?
Data and crypto analyst CryptoCon has outlined in a Twitter post the recent positive correlation between Bitcoin and the U.S. dollar, as measured by the DXY Index, and how this can drive the next bull trend for Bitcoin.
The analyst states that the bull market is in full effect, given the high correlation after the 2022 bear market between the DXY and BTC. Two out of three times, this correlation has been the precursor to BTC rallies in 2011 and 2015. The 2019 rally, as seen in the chart below, makes this the fourth time the correlation hinted at the beginning of a new, fully formed bull market.
It’s well known that crypto price movements have been correlated with the DXY index since the inception of the crypto market. The recent correlation has turned positive, as the DXY index gets a correction below its annual high of $105, as do Bitcoin and Ethereum on their respective charts. CryptoCon concluded:
Although Bitcoin is correcting, it is still primed for Bull Market upside. Market structure compared to July 2015 is entirely different, and instead looks just like the Nov 2015 surge before the Bull Market. Bitcoin is in an uptrend, and these are among the best cycle buying prices.
BTC’s recent reversal of the price action, which was expected to be strong support at the $23,500 level, has formed a new resistance wall for the flagship currency.
If the Bitcoin price action continues to wipe out the short and long positions by moving sideways, BTC could fuel up the liquidity at higher levels. This liquidity could allow BTC to surpass the nearest resistances of $23,500 and $24,000 to attempt another breakthrough, the critical resistance of $25,000, which for analysts, is the last obstacle for Bitcoin as it seems poised to break the milestone of $30,000 in the medium term.
Bitcoin is trading at the $23,300 level, below the critical support lost over the weekend with the retracement to $22,700. With this price drop, Bitcoin has seen a slight gain of 0.7% over the past 24 hours.
In broader time frames, the price of BTC has noted a decline of -3.9% in its price in the seven-day time frame but has managed to maintain gains in the fourteen and thirty-day time frames of 7.1% and 1.1%, respectively.
Featured image from Unsplash, chart from TradingView.