The price of Bitcoin (BTC) broke above $40,000 on Feb. 6 for the first time in 23 days. But this time, the market sentiment is a lot calmer with a less overheated derivatives market.<\/p>\n
The combination of a less crowded Bitcoin futures market, the selling pressure from whales peaking, and a fast recovery could help BTC stabilize above $40,000 this time.<\/p>\n
On Jan. 29, a pseudonymous Bitcoin researcher and analyst known as Material Scientist said that mega whale order flow reached an all-time high.<\/p>\n
This means that the selling pressure coming from whales dealing with $1 million to $10 million orders reached a record-high. The analyst said at the time:<\/p>\n
If the price of Bitcoin establishes $40,000 as a new support area, it would establish a highly positive short-term price trend for BTC.<\/p>\n
It would mean that BTC can now rally towards its all-time high without the massive selling pressure coming from major whales and high-net-worth investors.<\/p>\n
In the near term, for Bitcoin to maintain its bullish structure, it would need to protect two key support levels: $40,000 and $37,834.<\/p>\n
Meanwhile, according to the analysts at Whalemap, a data analytics platform that tracks whale data, there is a confluence of whale supports at $37,834 and $36,290.<\/p>\n
If Bitcoin breaks down from $40,000, these two support areas would be critical to defend. Below these two levels would likely result in a short-term bearish trend. The analysts wrote:<\/p>\n
In the foreseeable future, some traders anticipate Bitcoin to surge beyond $60,000 with the momentum from the ongoing rally.<\/p>\n
Scott Melker, a cryptocurrency trader, said there will be pullbacks, but Bitcoin would likely reach $63,000 following the breakout. He said:<\/p>\n
Bitcoin technically broke out of the bull flag when it surpassed $38,000 on Feb. 4. Considering that Bitcoin is looking stronger than the last time it broke $40,000 a month ago, there is sufficient momentum to carry it past $50,000this time around.<\/p>\n
A potential catalyst in the near term could be Guggenheim potentially confirming its investment in Bitcoin after securing the rights to invest in the Grayscale Bitcoin Trust in February.<\/p>\n
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