• 30 May, 2024
Markets News

Bitcoin Stability Above $62K Crucial for Upturn, Says Crypto Analyst

Renowned cryptocurrency analyst Skew has recently delved into the nuances of Bitcoin’s (BTC) market dynamics. The analyst highlights in a recent X post that Bitcoin is currently poised at a critical juncture, with its price actions showing potential for an upward divergence if certain conditions are met.

At the time of press, Bitcoin was hovering around $63,000, maintaining a delicate balance above the significant threshold of $62,000, which Skew identifies as crucial for the cryptocurrency to have any substantial chance of bouncing back to higher levels. He points out that for a positive shift, Bitcoin needs to reclaim its daily open and attract spot-taker bids, elements essential for confirming a bullish trend.

The analyst has identified that Bitcoin may face difficulties this week at its weekly open and the $66,000 mark. The primary risks that could negatively impact Bitcoin’s price include instability in the traditional financial markets and geopolitical tensions.

Source: Chart by Skew

Meanwhile, the analyst provides insight into Bitcoin’s Contract for Difference (CVD) and Delta, noting the choppiness in low-time frame (LTF) price actions. Market takers are leading the price toward both passive supply and demand, indicating a complex interplay of market forces. Despite a robust absorption of sellers at the $62,000 level, there remains a consistent de-risking in the perpetual markets, which now reflect a clear sentiment of pessimism.

Source: Chart by Skew

According to the order book on Binance Spot, the bid depth is 3.5% thick, while the ask depth is 12.3% thick. This indicates a significant preference for bid liquidity. However, Skew suggests that in order to shift from a risk-off to a risk-on environment, spot flows need to change, as well as occasional limit buying on LTF dips.

Source: Chart by Skew

Further complicating the landscape is the activity on the Coinbase spot, where the order book is notably thin despite aggregate spot demand around the $60,000 mark. The spot CVDs and Delta reveal considerable limit selling into price bounces and time-weighted average price (TWAP) selling that has driven slow grinds lower.

As Bitcoin navigates these challenging market conditions, Skew believes that the upcoming European trading session could be a crucial time for bulls to assert their strength and potentially steer the market in a favorable direction. The insights provided paint a picture of a market at a crossroads, where strategic moves and external factors will likely dictate Bitcoin’s path ahead.

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