Bitcoin has just erased part of its rebound after peaking at $82,281 on September 4. In fact, the price fell back to around $79,000, a decline of almost 4% in a few hours. The daily trend remains favorable, but short-term indicators indicate a loss of dynamism. It is the maintenance of the support located around 78,500 dollars which will now determine whether this drop remains temporary or invalidates the recent bullish exit.
In brief
- Bitcoin retreats towards $79,000 after hitting a high of $82,281.
- The support of $78,000 becomes decisive to preserve the momentum of the rebound.
- A break below $76,800 could bring the price back towards $74,081.
- The rebound above $82,000 was fueled by a short squeeze, with $250 million of short positions liquidated.
- Moving averages remain supportive, while short-term momentum shows signs of weakness.
$78,000 support decides fate of bitcoin rebound
The decline started after bitcoin rejected at $82,281. Then, the price was brought back to a buy order zone located between 78,500 and 79,200 dollars. Volumes exceeded those typically recorded on previous hourly candles.
Thus, the threshold of 78,000 dollars now constitutes the main line of defense for buyers. Its breakdown could expose the starting zone of the last increase, located between 76,567 and 77,300 dollars.
Over the next few sessions, various levels will be able to measure the strength of the market:
- Immediate support lies around $78,531;
- The zone between 76,800 and 77,300 dollars constitutes the second bulwark;
- A return above $79,420 would improve the short-term trend;
- The main resistances are at $80335 and $81430;
- A daily close above $82,281 would restart the upward movement.
According to analysisa confirmed breakout of $76,800 could invalidate the September 3 breakout. It would bring bitcoin back towards the daily pivot of $74,081.
The rise towards $82,000 was partly based on a short squeeze
The speed of the decline is also justified by the nature of the previous movement. This rebound above $82,000 did not come exclusively from new spot acquisitions. It had been intensified by the forced closure of multiple leveraged short positions.
Nearly $250 million in short bitcoin positions were liquidated in one day, compared to just $21.5 million in long positions. Across the entire crypto market, liquidations totaled around $758 million, including $480 million on bearish bets, according to some data.
A short squeeze can trigger a very rapid rise. Sellers forced to close their positions must acquire the asset, which temporarily increases demand. However, the movement may lose momentum once these buyouts are completed if new buyers do not take over.
The drop from $82,281 therefore does not yet indicate that the entire rebound is over. However, it reveals that the market has failed to maintain the gains obtained through liquidations.
Moving averages remain favorable, unlike momentum
The daily trend remains stronger than the movements seen on the hourly charts. Thus, BTC remains above the majority of its exponential and simple moving averages. Fourteen out of fifteen trend indicators still indicated a bullish signal.
Buyers therefore maintain the advantage over the general trend. Such an observation, however, depends on the ability of the price to successively recover 79420, 80335 and 81430 dollars.
A more cautious message is transmitted by the oscillators. The RSI hovered around 66 and remained neutral, while the MACD and momentum indicator offered bearish signals. In total, nine oscillators were neutral, two bearish and no bullish.
This difference specifies that the general structure of the increase remains intact, but that its immediate force decreases. Sellers therefore dominate the very short term without yet controlling the daily trend.
A good defense of $78,000 could allow bitcoin to rebound towards $80,300, then $81,400. On the other hand, a close below $76,800 could increase the risk of a return towards $74,081, an additional decline close to 6% compared to the first support.
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