Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.

Bitcoin saw a large drop in volatility in the past two weeks.
The $25k level was a critical support level that could see a reversal.

Bitcoin [BTC] prices have taken a siesta at the $26k mark over the past ten days. Neither the bulls nor the bears have seized the initiative in the lower timeframes yet. On 23 August, there was a bullish structure break on the 4-hour chart.

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The order book heatmap showed that significant volatility was likely to be seen in the coming weeks. This tied in with the spike in Implied Volatility in recent days. The report also showed a steady accumulation of Bitcoin by institutional buyers.

Bitcoin has a critical level of support at $24.8k, but are the buyers strong enough to defend it?

Source: BTC/USDT on TradingView

The cyan box at $25k represented a bullish order block from the 1-day timeframe. Therefore, if the bulls were to pull off a recovery, there is a higher probability that it would occur within this higher timeframe area of interest.

The market structure on the 4-hour chart was bullish after the move above the recent lower high (dotted orange) at $26.6k. Yet there has not been a follow-through on that break. Instead, BTC receded to the $26k mark.

The $24.8k level also represented the low of a range that extended from $24.8k to $31.8k. Therefore, a drop below this level would signify severe bearish pressure.

At the time of writing, the OBV continued its flat trajectory of the past week to reflect a lack of decisive buying or selling pressure. The RSI recovered and stood at 47.5 at press time.

Prices are attracted to liquidity, and whipsaw price action could commence in early September

Source: MobChart

The data from MobChart showed a large amount of limit buy orders at $25k and $24.8k, amounting to 476 BTC and 593 BTC, respectively. The $25.5k level has 126 BTC worth of limit buy orders. Converted to USD, it showed $3.2 million at $25.5k, $12.3 million at $25k, and $15.4 million at $24.8k.

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To the north, the closest significant liquidity pocket was at the short-term local high at $26.8k. Above that, there was a large wall of sell orders at the $30k level, which was a notable higher timeframe resistance zone from earlier in August.

Therefore, a move toward the $24.8k followed by a rally to the $30k level was a likelihood after the sustained muted volatility in recent weeks.

The post Is Bitcoin set to see wild volatility soon? appeared first on Crypto News Australia.

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Filed under: Bitcoin - @ August 29, 2023 3:20 pm