From February until May, Bitcoin was essentially range-bound. Nothing was clean and there were typical flushes and failed breakouts and weeks of drifting, but the yellow band between ~$73k and $74.5k acted as the point of gravity and the price would consistently gravitate back toward it. These were built upon it and the traders developed strategies around it.
It is now June, and in just less than three weeks the structure has been broken below it and is now overhead as we try to rally above. BTC is now changing hands close to $66,230. The price point where the market participants were all making decisions is now overhead and this makes it the fifth time in a row.
What the current overhead range depicting
The yellow zone on the daily is marked near the $73,000-$74,500 range and has been used as a floor, a ceiling, and a pivot from the month of February until late May. It saw positions being accumulated from both the buyers and sellers.
Those positions, at least a part of them, have endured the June sell-off towards the zone of $59,000-$60,000. Others were stopped out on the way down. Those who were still positioned in them for the entire ride are now deep in drawdown so that any retest will be involving forceful decisions, that of either trimming positions, holding on, or even adding to average the carried position. The overall effect of such decisions could result in more supply for the asset
This is how sharp, fast recoveries move differently if we compare them with slow-grind recoveries. We can clearly notice how the flush quickly clears the short side. This ride back up has to navigate its way through all of the longs that previously were underwater since the month of February. The marked green line at $70,571 can be called the first reference of meaningful price action back to that overhead area. Price has not yet attained the corresponding milestone as of this recovery.
The direction from the moving averages
All moving averages that matter are currently showing a figure above $66.23k. Only the SMA7 at $63.8k is below the current price of this largest cryptocurrency. SMA30 at $69.9k is the first significant challenge that comes in and is close enough to be reachable within a week of positive action, but the thing to note here is that every one of the traders who bought the May highs at $83k and has ridden it down has an average entry point that is roughly between here and the SMA200 at $77,500, none of whom will be neutral to seeing the price climb back to where they paid for it. The blue horizontal line at $79,456 that is marked on the chart lines up almost with the EMA200, meaning it was more of a prior structure support before the move down from February.
Momentum is forming a structure
The MACD turned green for the first time in weeks. An RSI7 of 58.53 points out the snap back to $59,000, but RSI14 and RSI21 remain stable close to the neutral zone at 43.85 and 41.79 respectively and both are well under 50. They are both being dragged by the rest of the month instead of the past seven days. That gap between short and medium-term momentum demonstrates it all, like the last several candles look favorable, whereas not from the price structure.
Bitcoin has seen a correction from $75,000 to $59,000 in the matter of days, and fast moves boost short coverage on the way back up. Traders who were stuck in the short at lower levels are now helping to fuel the initial bounce but still it is not giving a guaranteed move to one direction. This essentially clarifies most of the $8,000 recovery to $67,000. A consolidation that is at or above $66,000 before the start of the next leg is important since buyers who are holding current levels need to demonstrate they are not involved in just flipping.
