Key takeaways
- Bitcoin successfully tested the $58,000 support, potentially targeting the $60,500-$61,500 range.
- US spot Bitcoin ETFs saw outflows of $127 million following the price drop.
Share this article
Bitcoin (BTC) successfully tests key weekly support despite a rapid drop to the $58,000 price level on August 27. According to the trader identified as Rekt Capital, a weekly close above $58,447.12 could confirm BTC is back in a major price channel, which could potentially push it towards the $60,500-$61,500 area in the near term.
On the daily time frame, the trader added that the crash was also an opportunity for Bitcoin to successfully test the resistance of its previous downtrend channel as support.
Notably, Rekt Capital explained that a successful retest of this daily support would fully confirm the breakout and precede further upside, which eventually happened.
As a result, Bitcoin could be preparing to fill a new CME gap between $60,500 and $61,500, as the trader pointed out that BTC has filled every gap recorded over the past six months.
CME gaps are the differences between the closing and opening prices of Bitcoin futures contracts traded on the Chicago Mercantile Exchange (CME), hence the name. Typically, the price of BTC moves to cover the spreads between the spot and futures markets.
Sudden but regular crash
Yesterday’s crash was not linked to any major developments in cryptocurrency or macroeconomics. Aurelie Barthere, senior research analyst at Nansen, told Crypto Briefing that the market has been choppy since March and the flash dump was just a regular move after Bitcoin was rejected at the $62,000 resistance.
“This could explain the big red candle in BTC price yesterday,” she added.
Although this was a regular move, the sudden impact caused $110 million in liquidations in an hour, according to data from Coinglass.
Spot Bitcoin exchange-traded funds (ETFs) in the United States also had a tough day, with $127 million in outflows recorded, according to Farside Investors. data Yet, unlike the usually flighty capital from Grayscale’s GBTC, ARK 21Shares’ ARKB saw the most negative flows, as $102 million left the fund yesterday.
It is worth noting that the flows seen yesterday stand in stark contrast to the nearly $203 million that flowed into U.S.-traded Bitcoin ETFs on Monday, driven primarily by BlackRock’s IBIT capturing over $224 million in inflows.
Share this article
