Bitcoin (BTC) continued to bounce off $31,000 support during July 16 as fresh data reinforced the importance of current price levels.
No trip to $42,000?
A late surge to near $32,000 then entered as unconfirmed reports surfaced that Bank of America had given the go-ahead for Bitcoin futures trading.
Market participants held mixed opinions about the short-term outlook, with popular trader Michaël van de Poppe noting on Thursday that $31,000 was something of a final frontier for Bitcoin — lose it and $29,000 or even $24,000 would logically be next.
Fellow trader Crypto Ed also appeared undecided on the day. Earlier in the week, he had argued that Bitcoin could stage a shock rebound and hit its range highs of $42,000 before reversing downwards yet again to challenge $30,000 support.
“BTC making new lows is invalidating the idea of continuation of that bounce,” he wrote in an update. Even a comedown for the U.S. dollar currency index (DXY), traditionally inversely correlated with BTC, is unlikely to help bulls significantly, he added.
Update on this ⬆️
BTC making new lows is invalidating the idea of continuation of that bounce.
I still think DXY should see a pull back but it’s doubtfull that such will move BTC to 42k.
Maybe there’s no hidden play in the charts and BTC is just terribly weak and I was crazy pic.twitter.com/3nr65V9y4Z
— Crypto_Ed_NL (@Crypto_Ed_NL) July 16, 2021
Meanwhile, new data showed considerable on-chain activity having occurred at current price levels.
According to on-chain monitoring resource Glassnode, 9.93% of the Bitcoin supply moved between $31,000 and $34,300 — a clear zone of interest for both buyers and sellers.
“This is now convincingly the largest realised volume cluster since $12k,” the firm commented.
Previously, Cointelegraph noted that $30,000 itself forms an important level in the minds of both small and large traders, whose behavior has flipped from a “sell” to a “buy” mentality in recent weeks.
Altcoins lose out on middling sentiment
A look at altcoins meanwhile underscored the lack of bullish sentiment across cryptocurrency markets as the week came to a close.
Most of the top fifty tokens by market cap saw heavier losses than BTC/USD, these reaching up to 12% amid an absence of price triggers.
Ether (ETH), the largest altcoin, was heading to a crucial support zone of its own around $1,800. The start of a new accumulation period was now “very likely,” Van de Poppe said in a YouTube update on Thursday, prior to volatility reentering.
Bitcoin’s rising dominance, hitting 46% on the day, added to altcoins’ woes.