Bitcoin trader identifies the current optimal and most risky entry points to BTC
Bitcoin (BTC) has been trading within a narrow price range for the past 18 days, establishing important levels of support and resistance. These levels present both high-risk and ideal entry points for Bitcoin as it determines its future direction.
In a recent post on X, a well-known Bitcoin and cryptocurrency trader known as Credible Crypto warns of an upcoming period of volatility. According to him, BTC is currently at a high-risk entry point, trading near the resistance level of the range. This suggests the possibility of a short-term retracement, with the target being the range lows, which would serve as an ideal entry point at the price support level.
Credible Crypto attributes the anticipated volatility to a significant increase in open interest (OI), despite the range being relatively neutral. The trader predicts a potential short or long squeeze that could lead to a deviation and a breakout from the current range.
While both scenarios are possible, Credible Crypto expresses a bullish bias and hopes for a short squeeze that would result in an upward breakout.
Data retrieved from CoinGlass and TradingView on June 5 supports the trader’s analysis of Bitcoin. BTC’s open interest in futures is approaching its all-time high, currently standing at $37.66 billion. The previous record of $39 billion may soon be surpassed, indicating a strong speculative demand.
On the daily chart, BTC/USD has been trading within a range of $60,000 to $72,000 for the past three months, with two notable deviations. One deviation reached a high of $73,805, while the other dropped to $56,535. Within this broader range, there is a tighter zone that Credible Crypto mentioned in his analysis.
Specifically, this narrower range has a resistance level at $72,000 and a higher support level at $66,000. The trader considers the latter to be an ideal entry point for Bitcoin if it occurs.
However, Bitcoin has recently experienced a decrease in transaction volume and spot trading volume, while speculative volume on BTC futures and exchange-traded funds (ETFs) has increased. This suggests that the market is currently driven more by speculation than actual trading activity.
As with any speculative market, cryptocurrencies are highly volatile, especially during times of uncertainty in financial markets. Therefore, investors should rely on various analyses and indicators to make informed decisions and adjust their positions accordingly.
Disclaimer: The content of this article should not be considered as investment advice. Investing in cryptocurrencies carries risks, and investors should be aware that their capital is at risk.