Shorts rebound, BTCs key support is around 88,000

Original source: BitpushNews

The kriptocurrency market continued its correction trend on Tuesday.

According to Bitpush data, Bitcoin continued to be under pressure after hitting a high of $95,000 in the morning. In the afternoon, bulls tried to rebound, but encountered bearish resistance at $94,800 and fell below $91,000. At the time of writing, Bitcoin was trading at $91,646, down 2% in 24 hours. The altcoin market performed even weaker, with more than 90% of the top 200 tokens by market value recording losses.

The overall cryptocurrency market cap is currently $3.14 trillion, with Bitcoin’s dominance rate at 57.3%.

In the U.S. stock market, the SP, Dow Jones and Nasdaq indices all closed higher, up 0.57%, 0.28% and 0.63% respectively.

The decline may be due to overheating of the leveraged market

Part of the reason for the decline in Bitcoin may be that there are too many leveraged transactions in the market. When the market fluctuates, these leveraged transactions will be forced to close, causing prices to fall further.

Data analysis platform IntoTheBlock expressed a similar view, arguing that Bitcoins pullback can be attributed to the increase in funding rates, which ultimately led to a bearish market. However, as funding rates return to normal ranges, further leverage liquidations should be limited.

Byzantine General, a cryptocurrency futures market analyst, pointed out that in terms of trading volume, Bitcoins current price trend is similar to some previous local tops. He said, Bitcoin is likely to fluctuate sideways for a period of time at this time. However, during this period, some other cryptocurrencies may perform well.

From a technical perspective, Bitcoin may retest the liquidity area around the psychological level of around $90,000 and may even fall further to $85,000.

This is because Bitcoin rose very quickly between November 6 and November 22, without a clear imbalance between buying and selling. This rapid rise is usually accompanied by a subsequent pullback to balance supply and demand. Therefore, Bitcoin may retreat to the previous support level or lower to digest the previous gains.

Additionally, with the relative strength index (RSI) falling below 50 for the first time since November 6, sellers are expected to dominate price action in the coming week, which could lead to a period of consolidation below $95,000 for Bitcoin.

Crypto investment research analyst CoinSeer believes that the important support below Bitcoin is in the range of US$85,000-88,000. Once it falls below, it may trigger large-scale chain liquidations.

TradingView analyst TradingShot wrote: Yesterdays sharp Bitcoin pullback caught the market off guard. There are several basic reasons behind this: one is the gradual fading of post-election excitement, and the other is the pressure brought by the psychological level of $100,000. However, there is a more important technical reason that has been overlooked.

The analyst noted: “As shown in the chart, there is a Fibonacci channel in place for the past three cycles (including the current one). This channel started from a strong rally when the top was formed in December 2013. The top of that cycle happened to be at the 0.236 Fibonacci level of the cycle, which blocked the rise in the bull markets on June 24, 2019 and May 11, 2024.”

TradingShot said the recent pullback was because Bitcoin hit the “first real resistance in the bull cycle.”

He explained: “This is the Fibonacci trendline that recently (Nov. 22) blocked the rise. We can call it the ‘first real resistance of the bull cycle’ because it is the first major resistance level that the bull cycle encounters before it finally tops out. In the past two cycles, the highs have occurred at the 0.0 Fibonacci level, which is the top of the channel (red circle in the figure). The red dot at the end of 2025 is not a prediction, it is just for comparison.”

TradingShot also observed: “The duration of each bull market cycle in the past has been about 150 weeks (1,050 days), and if this pattern repeats, the highs could come in late September or early October.”

He noted: “It is much better to try to catch the high and sell than to give an exact price. It is also interesting that although BTC is technically resisted, the current rally started from the low of August 5, 2024, right on the 1-week MA 50 (blue trendline). Technically, as long as this trendline remains valid, the cyclical bull wave should be able to remain intact.”

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This article is sourced from the internet: Shorts rebound, BTCs key support is around 88,000

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