Bitcoin is right now backtesting its realized warm supply floor ($94,550). This level equals the weighted average purchase price of mid-term holders. This test comes amid market inflation that has seen Bitcoin break over the $97,000 level in trading on Thursday. Analysts are calling this the start of it that’s not just going to go one way and up.
Recent price action is being driven, in large part, by strong institutional buying. MicroStrategy, for one, is buying more Bitcoin every month than miners can still mine. Currently, miners produce approximately 13,500 Bitcoin monthly.
Companies such as MicroStrategy are gobbling up existing assets in large quantities. This development is causing some commentators to call it a “synthetic halving,” which lowers the supply that is available and can thereby increase prices.
Capo Of Crypto, a well-known Bitcoin market commentator, expects Bitcoin to find a local top and trade sideways between the $92,000–$98,000 level. He points to this range as an important resistance range for Bitcoin to test.
As per Capo Of Crypto, if Bitcoin continues to trade above $92,000, the market will remain in a bullish territory. He warns that major selling pressure awaits just below, in the $96,000–$98,000 range. Such resistance may suppress Bitcoin’s short-term upside potential.
Bitcoin’s meteoric rise above $96,000 comes just days ahead of what is being called a “historic week” for the cryptocurrency. Crypto chartist Ali Martinez is intently watching Bitcoin price action, looking to pinpoint critical support and resistance areas.
