Bitcoin must close the week above this level to start ‘price discovery 2’

admin06 mins


Key points:

  • Liquidity is tightly clustered around current spot price, with $106,000 the likely next battleground.

  • Some traders are expecting the bid to enter price discovery to fail.

Bitcoin (BTC) preserved giant gains into the May 11 weekly close as analysis flagged the key level to hold next.

BTC/USD 1-hour chart. Source: Cointelegraph/TradingView

Analysis: BTC price can “kickstart the breakout process”

Data from Cointelegraph Markets Pro and TradingView showed weekend upside volatility, delivering new multimonth highs of nearly $105,000.

A lack of liquidity during “out of hours” trading contributed to the move, which once more came on the back of positive rumors over a US-China trade deal.

Now, popular trader and analyst Rekt Capital confirmed that Bitcoin could even kickstart a return to all-time highs and price discovery.

The all-important weekly close level to flip to support, he said, lay at around $104,500.

“Can Bitcoin do it? Can Bitcoin Weekly Close above the Range High of its recently reclaimed Re-Accumulation Range to kickstart the breakout process?” he queried in a post on X alongside an explanatory chart.

“Bitcoin is on the cusp of beginning Price Discovery Uptrend 2.”

BTC/USD 1-week chart. Source: Rekt Capital/X

An additional update calculated the current Bitcoin bull market as 85.5% complete, yet with the most erratic upswings still to come.

A look at the latest exchange order book data from monitoring resource CoinGlass showed a large cloud of asks clustered around the area immediately below $106,000 at the time of writing.

Bids were laddered down to $102,000, creating a thickening band of liquidity around spot price into the weekly close.

BTC liquidation heatmap. Source: CoinGlass

Bitcoin can still retrace “entire move”

Some market participants remained bearish on short timeframes.

Related: Is Bitcoin about to go parabolic? BTC price targets include $160K next

On X, popular trader HTL-NL argued that the current push toward all-time highs would end as a “fakeout” to trap late longs.

“Will $BTC close/open the week remaining within the range, will it do a ‘fake out (UTAD)’ or was this really a reaccumulation range as many want to believe,” he wrote on the day. 

“To be honest, although I still favour the first 2 options based on M/Q charts, it being reaccumulation is not impossible.”

BTC/USDT 1-hour chart. Source: HTL-NL/X

Another voice of caution, one all too familiar in Bitcoin trading circles, came in the form of fellow trader Il Capo of Crypto.

In his latest X updates, the pseudonymous commentator warned that BTC/USD could correct to the extent that its entire rebound disappears.

“This is the time to scale out, not in,” he argued on May 10. 

“Strong resistances are being tested, and if this is just a correction of the downtrend since January, the entire move could eventually be fully reversed.”

Il Capo of Crypto originally gained notoriety for his $12,000 BTC price targets at the start of the bull market in 2023.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.