Bitcoin was sitting under pressure around $61,200 when it suddenly reversed and shot all the way up to $64,600 in a sharp, fast move that took most traders by surprise.
Before that bounce, a wave of buyers got wiped out at the bottom. Their positions were forcibly closed, clearing the way for the price to move upward with less resistance. At the top of the rally, the opposite happened. Traders who had bet against Bitcoin got squeezed out as the price ran higher than they expected.
This kind of move, where both sides of the market get punished before any real trend begins, is common in Bitcoin. The market tends to shake out weak positions in both directions before committing to a sustained move.
Why the Rally Hit a Wall
Once Bitcoin reached $64,600, it stopped. Several things lined up at that price to slow it down.
It hit a zone where a lot of previous trading activity had already taken place, meaning there were plenty of sellers waiting there. Multiple momentum indicators on the four-hour chart were also flashing warning signs, showing that buying pressure was actually weakening even as the price was still climbing. When price goes up but the strength behind the move is fading, it often means the rally is running out of fuel.
The daily chart also showed the same warning signals, with the market sitting in territory typically associated with short-term tops.
Two Price Levels to Watch
Around $61,000 is the first zone traders are watching. There is a significant cluster of buy orders and stop losses sitting just below the recent low in this area. Price has a tendency to gravitate toward spots where a lot of orders are stacked up.
Around $60,000 is the bigger support level below that. If $61,000 does not hold, this is where the next serious floor sits based on how the market has behaved at this price historically.
When Does the Story Change
If Bitcoin closes clearly above $64,650, the bearish setup gets cancelled. The next meaningful target after that would be around $65,600, and beyond that $67,000 comes into view.
Until that happens, the lower probability scenario is another push higher. The higher probability scenario is one more dip before any real upside begins.
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