Bitcoin traders line up “safe” support levels, but order book data makes one observer uneasy about the future.
Bitcoin (BTC) sought to pass $27,000 on May 13 after a “scam wick” produced new two-month lows.
Traders: BTC price must retain $26,500
Data from Cointelegraph Markets Pro and TradingView followed BTC/USD as it recovered from a flash dip to $25,800 on Bitstamp.
The pair saw weakness after the start of the week’s final Wall Street trading session, briefly cutting through the key 100-day and 200-week moving averages (MAs) before rebounding.
As the weekend began, market participants were split over the likely course of events to come.
“Nice daily close. Has to hold 26.5K going forward. That’s the line in the sand for me,” Daan Crypto Trades told Twitter followers.
Michaël van de Poppe, founder and CEO of trading firm Eight, agreed that the May 12 daily candle had turned out to be “good.”
Analysis before the local lows likewise flagged $26,500 as an important level to reclaim in order to consider long positions.
#Bitcoin is showing weakness and #altcoins are slightly bouncing in their BTC pairs as they have been retracing significantly.
Overall, I’m looking at a case that we need to reclaim $26,500-26,800 before hitting longs (mentioned yesterday).
Otherwise, $25K. pic.twitter.com/dgwxdH3NHE
— Michaël van de Poppe (@CryptoMichNL) May 12, 2023
For fellow trader Crypto Tony, the potential long flip level was higher at $27,300 despite the “nice bounce” overnight.
“We are also in the weekend now, so liquidity itself will be far less,” he added in a tweet on the day.
200-week trend line loss would “invalidate” bull thesis
Turning to the state of the Binance order book, meanwhile, monitoring resource Material Indicators remained far from optimistic.
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A lack of bid liquidity formed a major point of concern, with the largest cohorts of whales abstaining from the market.
“IF there is a bullish case to be made, it’s that price over shooting technical R & S has been the norm in #crypto, and that price is currently back above the 200-Week MA,” part of analysis after the lows stated.
“Perhaps the most neutral thing I could say is that consolidating in this range would be healthy because it would give the market the chance to decide whether it wants to continue distribution or flip to accumulation and that would add validity and strength to whatever the next move is.”
Material Indicators continued that the 200-week MA remains a key line in the sand when it comes to the bullish thesis going forward.
“The bearish case is quite simple,” the analysis read.
“If we continue to see a lack of bid liquidity and a lack of buying from the purple and brown whale classes it will lead to more downside. Any sustained breach back below the 200 WMA invalidates any bullish dream of a breakout.”
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