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3 technical reasons why a rebound can occur

May 27, 2020

The price of Bitcoin (BTC) rose above $ 9,000and shows a decent recovery in the past 24 hours. Market data show that A further short-term increase to $ 9,300 to $ 9,400 is likely.

Three main reasons increase the likelihood of a minor rebound: The short term liquidation of 25x to 50x is $ 9,300, the whales use the Goldman Sachs narrative and the low funding rates on the futures market.

The short-term settlement price from 25x to 50x

According to a cryptocurrency trader known as “Crypto ISO”, The short-term billing range from 25x to 50x, which is in the range of $ 8,000, is $ 9,300.

3 technical reasons why a rebound can occur3 technical reasons why a rebound can occur

The resistance level of $ 9,300 also has enough liquidityThis gives whales an incentive to raise the price of BTC above. The dealer said:

$ 9,298 is 25 times liquidity, $ 9,336 is 50 times liquidity. Around the recoil channel line and the Fibonacci zone. The price cut most of the liquidity today. Perhaps liquidity increases from above before more is distributed. Goldman will call a customer and one of the issues to be discussed is BTC.

The liquidation zone for 25x and 50x Bitcoin shorts is USD 9,300

Bitcoin’s 25x and 50x short term settlement zones at $ 9,300. Source: CryptoISO

In April, when the Bitcoin rally was primarily led by the spot market from $ 7,000 to $ 10,000, the futures market had less impact on the price of BTC.

The open positions of BitMEX, OKEx and Binance Futures have recovered in recent weeks. This indicates that there are more active traders on the futures market. Therefore, futures data such as settlement areas and financing rates can have a greater impact on BTC price developments than before.

Whales use the Goldman Sachs narrative

Goldman Sachs will call a customer on May 27. The main topics are bitcoin, gold and inflation.. In the medium and long term, this can increase the commitment of wealthy individuals to BTC. It also improves the perception of bitcoin as a store of value among institutional investors.

However, A Goldman Sachs customer call is unlikely to result in a short-term institutional purchase. Whales are more likely to use the narrative to trigger a small surge to a liquidity range of $ 9,300 when the price of BTC rises due to the news.

Bitcoin overtakes $ 9,000 before Goldman Sachs customer call

Bitcoin surpasses $ 9,000 before Goldman Sachs customer call. Source: Trading View

A similar trend was observed in October 2019. At this moment Chinese President Xi Jinping advocated accelerating blockchain development. The news itself did not refer to cryptocurrencies, but to the price of BTC rose from $ 7,000 to $ 10,000 in 48 hours.

Low funding rate

The financing rate of the Perpetual Swap futures contracts of BitMEX, Bybit and Binance Futures was negative on May 26th. It has risen slightly below 0.01%, but remains historically low for Bitcoin.

This indicates that a large number of traders are making short-term sales of Bitcoin. and they may be caught in short underwater positions. This increases the likelihood of a short position in the resistance zone from $ 9,300 to $ 9,400.

The low funding rate, FOMO related to the Goldman Sachs call, and the short-term settlement zone of $ 9,300 could lead to a small bitcoin rally.

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