Bitcoin’s price swung dramatically on April 4, but traders point to a short-term correction as investors chose to consolidate upon each dip.
The crypto market advance that began on April 1 ran into tough resistance on April 4, resulting in a market-wide drop during the afternoon session as fatigued bulls were swamped by bears who managed to drive Bitcoin (BTC) below 45,200 dollars.
According to data from Cointelegraph Markets Pro and Trading View, Bitcoin hit a daily low of $45,133 after significant selling in the afternoon fell below the $46,000 support level, before buyers attempted to purchase again for over $45,700.
According to many analysts, here is what the short-term outlook for Bitcoin looks like going forward in April.
Transform resistance into support
The April 4 weakness on the Bitcoin chart was detected early on by cryptocurrency trader and Twitter user ShardiB2, who tweeted the chart below, adding that the price had “started to reverse” as the four-hour candle approached the channel’s bottom.
Where the trader said: “Can we go down to $44,300? Probably, but if we do, I don’t think it’s growing much deeper; the only thing that worries me is the tax sale we saw last year…”
On-chain data analyst Matthew Hyland gave a more comprehensive explanation of the current market behavior, posting the chart below detailing important Bitcoin support and resistance levels in the current price range.
As Hyland said: “Bitcoin is trying to flip previous resistance to the new support.”
Assembly marks are heavy
The newest newsletter from the on-chain analysis business Glasnode discusses insights into market participants that have been aggressively acquiring Bitcoin recently, noting that “whales are the most aggressive collectors recently.”
Glasgow cited “major purchasers from the public such as Luna Foundation Guard and Microstrategy” who had “renewed their emphasis on Bitcoin as a true security” and “begun serious pooling over the previous two weeks” on the whale side.
This whale aggregation can be seen in the red shaded box on the next chart, whereas smaller purchasers have been “heavily aggregating” since late January, with smaller stocks being “heavily aggregating.”
As Glasnod said: “Overall, the market appears to be viewing Bitcoin and its role in the future economy with somewhat renewed optimism.”
A moving average of 125 days hints at a breakout
A recent “interesting remark” concerning Bitcoin price behavior was made by cryptocurrency investor and Twitter user Crypto Bull God, who uploaded the chart below, which examines the history of Bitcoin price movement relative to the 125-day simple moving average (SMA).
where the trader said: “We can see how critical this crucial level is.” The price increased considerably when it fell below and then rose above.”