Key points
- Bitcoin successfully tested the $58,000 support, potentially targeting the $60,500-$61,500 range.
- US Bitcoin spot ETFs saw outflows of $127 million following price drop.
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Bitcoin (BTC) is successfully testing the key weekly support despite quickly dropping to the $58,000 price level on August 27. According to the trader identified as Rekt Capital, a weekly close above $58,447.12 I could confirm BTC has returned to a major price channel, which could lead it to reach the $60,500 to $61,500 area in the near term.
On the daily time frame, the trader aggregate that the drop also served as an opportunity for Bitcoin to successfully test the resistance of its previous downtrend channel as support.
In particular, Rekt Capital explained that a successful retest of this daily support would fully confirm the breakout and precede bullish continuation, which ended up happening.
As a result, Bitcoin could be preparing to fill a new CME gap located between $60,500 and $61,500, as the trader stressed that BTC filled every gap recorded in the past six months.
CME gaps are the deviations between the closing price and the opening price of Bitcoin futures contracts traded on the Chicago Mercantile Exchange (CME), hence the name. Typically, the price of BTC moves to cover the discrepancies between the spot and futures markets.
Sudden but regular fall
Yesterday’s drop was not related to any major developments in the crypto or macroeconomic space. Aurelie Barthere, senior research analyst at Nansen, shared with Crypto Briefing that the market has been unstable since March and the sudden drop is just a normal move after Bitcoin was rejected at the $62,000 resistance.
“This could explain the big red candle on BTC price yesterday,” he added.
Despite being a regular movement, the sudden impact triggered liquidations of $110 million in one hour, according to data from Coinglass.
US spot Bitcoin exchange-traded funds (ETFs) also had a rough day, with $127 million in outflows recorded as Farside Investors data However, unlike the capital that usually leaves Grayscale’s GBTC, ARK 21Shares’ ARKB saw the most negative flows, with $102 million leaving the fund yesterday.
Notably, the flows seen yesterday are in stark contrast to the nearly $203 million directed into US-traded Bitcoin ETFs on Monday, driven primarily by BlackRock’s IBIT, which captured over $224 million in inflows.
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