Bitcoin remains in its tightly coiled range as the market continues its sideways trend for the third week in a row. While macro support has been tested three times recently, we have yet to test the overhanging macro resistance:
Figure 1: BTC-USD, Daily Candles, Narrow Range
The blue zone outlined above shows a very strong zone of support that, over the last few weeks, has seen three strong tests and has led to a slowly upward-drifting market consolidation. Since re-establishing support, the market has yet to see a meaningful retest of the overhead resistance outlined above in the red dashed and solid lines. The immediate resistance sitting overhead has, historically, been a highly volatile period where supply has manifested and stifled any bullish pressure:
Figure 2: BTC-USD, Daily Candles, Three Rejections
The black level outlined above represents the preliminary level that the market had tested prior to shoving to the red macro resistance levels. In Figure 2, we can see three clear tests followed immediately by three rejections. And now, after finding support on a major, macro level (the blue zone), we seem to be meandering upward into the immediate overhead black resistance.
This current move is considerably different from the prior moves. The three prior tests occurred very violently and were matched with overwhelmingly violent selling responses. Our fourth test, however, has been a slow, persistent grind. Upward drifts like this are often signs of weakening supply and, consequently, a weakening resistance level.
While it is still early to tell and we have yet to actually establish support on this level, the early signs of bearish exhaustion are starting to surface as we make our way upward.