- Bitcoin has seen some wild chop as of late, with the crypto’s price ranging between the lower and upper-$30,000 region
- It has found some strong support within the lower part of this range, with sellers attempting on multiple occasions to break it to no avail.
- The cryptocurrency has also been seeing large bouts of buying activity to counter selling pressure that appears to be coming from large whales on Coinbase and Binance
- As soon as these bears lift their sell walls or run out of coins to sell, BTC could begin flying higher
- One trader is now noting that although the crypto appears to be positioned for further upside, high funding rates remain a potential catalyst for a long-squeeze
Bitcoin has seen some positive price action this morning, with the crypto rallying higher following a sharp overnight selloff that sent the cryptocurrency down to lows of $34,800.
The buying pressure here proved to be significant and helped spark a rebound that is still unfolding at this moment.
BTC’s price ran as high as $37,500 before facing an influx of buying pressure that slowed its ascent.
It still is looking strong, and there’s a large possibility that it sees further near-term upside once $37,000 is flipped to support.
One analyst is cautioning against getting too excited, as he notes that high funding rates seem to indicate that there could be a long-squeeze in Bitcoin’s future.
Bitcoin Rebounds Following Sharp Overnight Selloff
At the time of writing, Bitcoin is trading up just under 3% at its current price of $36,900. This marks a notable rally from its overnight lows of under $35,000 set just several hours ago.
Where the crypto trends in the mid-term will likely depend on its continued reaction to $37,000. This is a resistance level for BTC, which would make flipping it into support technically significant.
Analyst: BTC’s High Funding Poses a Risk to Upside Potential
One analyst explained in a recent tweet that Bitcoin’s short-term upside potential is currently being hampered by the high funding rates for leveraged positions.
This could indicate that being long is an incredibly crowded trade and that a Bitcoin long-squeeze is imminent.
“TWAPs & daily opens seem to be really important these days. Funding is getting pretty high again though, so I don’t think there’s a whole lot of room for further upside.”
Image Courtesy of Byzantine General. Source: BTCUSD on TradingView.
The coming few days should shed some light on Bitcoin’s outlook, with its reaction to $37,000 and ultimately to $40,000 setting the tone for where it trends in the mid-term.
Featured image from Unsplash.
Charts from TradingView.