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After resistance regains control of Bitcoin’s current effort to reach $40,000, a test of support levels is on the horizon.
On Thursday, Bitcoin (BTC) suffered further losses as investors focused on an imminent test of a key support zone.
No price breakout for Bitcoin
Data from TradingView tracked a 5% decline in BTC/USD overnight on Wednesday.
As previously reported, attention is currently focused on a price range of $32,300 to $33,000 to establish a floor. On Thursday, famous trader Michael van de Poppe emphasised the importance of that zone holding.
The pair had reversed after hitting over $36,700, wiping off the majority of the gains it had secured in a weekend run-up.
“Would be nice if Bitcoin creates a higher low here & flips $33K for support to sustain the momentum,” he said in his latest Twitter update.
Exchange orderbook data broadly supported the thesis, with buyer interest lined up at an area around $32,000, while $37,000 seller resistance remained intact on Binance.
At the time of writing, BTC/USD was falling steadily toward the zone of interest, circling $33,300.
Waiting for seller exhaustion
The current spot price decline so perpetuates the “tale of two Bitcoins” situation that has evolved over the last week or so.
On-chain indicators, in particular, are largely positive and claim that a rebound is already begun, despite BTC price action failing to conform.
Analyst William Clemente III summarised remarks from statistician Willy Woo on Tuesday, pointing to a reaccumulation of BTC as the primary takeaway from the previous month’s turbulent pricing period.
Woo had uploaded Bitcoin liquid supply ratio data showing strong hands adding to their positions while new investors panic sold.
“Imo this chart is the easiest way to visualize what’s taken place over the last month under the hood,” Clemente III commented.
“Strong hands have added increasingly through recent price decline, now offsetting selling from weak hands. Now we wait for reaccumulation to complete — seller exhaustion.”