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November 27, 2022
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Guide & Analysis

Bitcoin may have a possible break above 40k resistance

As of this writing, the BTC is trading at $40,436, with a profit of 2.36% on the daily chart and 31.9% on the weekly chart.

BTC with strong bullish on the daily chart. Source: BTCUSD Tradingview

The feeling is growing as the Bitcoin continues to face important resistance at key levels. In addition, CryptoQuant data point out for bullish indicators.

Despite an increase in BTC inflows to FX platforms, most sales appear to be absorbed by strong buyers. As a result, Bitcoin cash reserves on exchanges are in a downtrend, as shown in the chart below.

Bitcoin may have a possible break above 40k resistance 23
Source: CryptoQuant

CryptoQuant claims this is the “highest outflow level” since Bitcoin has been testing the lowest levels of its current range, around $29,000, and the high levels of $40,000. Therefore, it is possible to assume that the BTC price could find sufficient support for a further rise from previous highs.

At the first retreat, after surpassing $30,000 at the beginning of the year, there was the same spike in the volume of outflows on stock exchanges. We need to see how the price breaks a new resistance to the last historical top (…)

These data also suggest that the price could recover from its previous high without “great demand”, says CryptoQuant. There was BTC outputs similar in mid-July, but the report assigned this to an internal transaction. The recent peak is even larger than the previous outflow, indicating

Clearly big players capitulating to the liquidity of the bears who were betting on breaking support at $30,000.

Bitcoin may have a possible break above 40k resistance 24
Source: CryptoQuant

Bitcoin will receive $50,000 in the coming weeks?

A separate report from QCP Capital highlighted that the recent price hike came despite e-commerce giant Amazon denying rumors about its alleged cryptographic payments program. In addition to the high BTC outflows, there was a spike in flow in the options market.

This one peak was recorded during the days leading up to the big rally that took the BTC from the lows of $30,000 to its current levels. As QCP Capital said, there was a call buying spree with over 2,000 BTC in 42,000 and 44,000 strikes with 3-week expirations.

In other words, some investors may be betting on further appreciation in the coming weeks. This could be additional fuel for Bitcoin to break its current pattern. QCP added capital:

However, the vol market reacted quite differently this time, with signs of stress at the top. Unlike the previous rally, which only saw the front-end vols increase while the back-end remained stable, this time the rear vols moved higher in tandem with the peak in the front-end vols.

For the short term, the company forecasts further resistance at current levels with a potential TD 9 sell signal for July 29 th . During the weekend, expiration of the end-of-the-month options can take Bitcoin to $40,000 and $42,000. If that is the case, QCP Capital expects these levels to be maintained with a potential extension to $50,000.

Source: QCP Capital
Source: QCP Capital

Source: News BTC

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