Bitcoin ‘Bart Simpson’ returns as BTC price dives 7% in hours

After a quick sell-off, Bitcoin (BTC), firmly committed to its trading range for June 7.

BTC/USD 1-hour candle charts (Bitstamp). Source: TradingView

“Some of our favorite chops”

Data from TradingView and Cointelegraph Markets Pro showed that BTC/USD rejected decisively the resistance it encountered last June 1.

Although the pair had been delivering daily gains exceeding 6%, the move to $32,000 changed the mood and Bitcoin gave back nearly $2,500 within hours.

As frustrated traders tried to overcome the current paradigm, a “Bart Simpson” structure was created.

In a Twitter update, Michael van de Poppe, a Cointelegraph contributor, wrote that there was “Standard Price Action Again on Bitcoin in Which All the Lows Are Swept.”

“If we have around $29K, there is still reason to make a small run. (And the $29K region is still CME gap territory.

CME Bitcoin futures 4-hour candle charts with an unfilled gap highlighted Source: TradingView

Material Indicators, an on-chain analytics resource for Material Indicators, noted that there was significant buy interest at these levels.

#FireCharts 2.0 beta shows $60M in #BTC bid liquidity. It is now at $29k. The next trade will be determined by whether it is filled, defended or spoofed. #crypto #tradingstrategy https://t.co/iCsO8yQgDB pic.twitter.com/Du6uXRc9U1
— Material Indicators (@MI_Algos) June 7, 2022

If that fails, then targets will be set next at $28,000.

It was a very weak reaction. The melted material is now resistant. This is where I believe we are heading to the lows marked with an “x”. There may be some relief between. All this sideways chop/ranging, imo, is part of the bottoming process. $BTC https://t.co/vx7qpIaUjf pic.twitter.com/x3pwqEjFeN
CrediBULL Crypto (@CredibleCrypto), June 7, 2022

Crypto Tony, a fellow trader, said that he would only be looking for opportunities within this range. He was referring to the ongoing downtrend.

“Either we lose range low and shorten a retest or we retest EQ of range and reject, i will seek a short position. Flat until one of these triggers occurs.”

Filbfilb (co-founder of DecenTrader trading platform) was one market participant who wasn’t surprised by the action in a short timeframe.

He laughed and said, “Some of our favorite chops we’ve ever seen tbh. High quality stuff.”

“I would say it’s always the exact same, people trying not to miss the bottom but this one is especially funny because it’s immediately reversing. Trade chasers are getting completely ruined.”

Long-term traders who were struggling with volatility led to 24-hour liquidations of $60 million for Bitcoin and $158 million for altcoins. Data from the analytics platform Coinglass confirmed this.

Chart of crypto liquidations. Source: Coinglass

Stocks and their correlation blurred

Bitcoin altcoins have thus been severely underperformed in comparison to notionally correlated U.S. equities.

Related: BTC price snaps longest losing streak in its history — 5 things you should know about Bitcoin this week

The S&P 500 and Nasdaq Composite Index closed the June 6 trading session higher than the open. This puts into question their relationship to crypto.

Yassine Elmandjra from ARK Invest noted, however, that Bitcoin’s overall correlation with the S&P had reached new highs over a rolling 30-day period.

The correlation between Bitcoin and the S&P 500 is at an all-time high pic.twitter.com/jwT5KQWeIQ
— Yassine Elmandjra, @yassineARK, June 3, 2022

He discussed BTC price action more and argued that the “major” trendlines on BTC/USD remained intact despite May’s dip of $23,800. Cointelegraph reported that this was still an opportunity for a retest.

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Eileen Wilson

Eileen Wilson –Technology and Energy My Name is Eileen Wilson with more than 5 years of experience in the Stock market industry, I am energetic about Technology news, started my career as an author then, later climbing my way up towards success into senior positions. I can consider myself as the backbone behind the success and growth of topmagazinewire.com with a dream to expand the reach out of the industry on a global scale. I am also a contributor and an editor of the Technology and Energy category. I experienced a critical analysis of companies and extracted the most noteworthy information for our vibrant investor network.

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