The Bitcoin price is down by 2.5% on May 23, surprising traders who were certain that new all-time highs were in the cards after the cryptocurrency’s early week rally to $72,000.
Data from Cointelegraph Markets Pro and TradingView showed that leveraged long traders were caught off guard as the price of Bitcoin suddenly dropped from a high of $71,980 on May 21 to an intra-day low of $67,550 on May 23.
“Bitcoin is still following a similar path to 2016-2017,” said independent analyst Jelle, reacting to what has become a familiar pattern for BTC in previous cycles.
Jelle said that Bitcoin would enter a parabolic uptrend once it breaks the 2021 all-time highs, projecting a Bitcoin price of $100,000.
Trader and analyst Mags explained that the current BTC correction could be a “fake out,” a pattern it has displayed since bottoming out at $15,500.
“Price consolidates inside a range for a few weeks or months, then it breaks down below the range, trapping all the bears, followed by a quick reclaim and another leg up.”
Jelle also noted that BTC’s recent recovery above $65,000 saw it break “all key resistance levels,” including the 50-day exponential moving average (EMA), which is currently at $64,665.
Jelle further explained that this has resulted in “hidden bullish divergence,” further supporting Bitcoin’s upside.
Related: Bitcoin price at $150K in 2024 is ‘base case’ — Tom Lee
Fellow analyst Matthew Hyland noted that the BTC price was close to retesting the demand zone between $64,000 and $67,000, representing the neckline of an inverse head-and-shoulders pattern.
“Bitcoin broke out above the H&S and closed a daily candle above it. A rest of the breakout at $67K is always possible. So, if it were to happen, do not be alarmed. The overall structure is bullish on a higher timeframe. Bitcoin tested the last resistance before all-time highs.”
Popular analyst Wolf Of All Streets shared the following chart, saying bulls would want to see the $67,000 support area (center of range) hold as support. This indicates that the price will now range between $67,000 and an all-time high of $73,835.
The analysts explained that this range provides a technically high risk-to-reward buy.
However, those betting on BTC’s recovery from the current levels lost big on May 23, as the downturn liquidated $159.3 million in long positions worth amid a 24-hour total wipeout of $227.51 million, according to data from Coinglass.
With the latest drawdown, $46.75 million in BTC leveraged positions have been liquidated over the last hour alone, with $39.6 million of these being longs.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
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