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Since BTC topping out at $6,500 on March 31, the Bitcoin price had spent the majority of Wednesday in a steady slump which saw the price drop from $6,494 to $6,147.
The pullback mirrored the poor performance in traditional markets where the S&P 500 and Dow dropped by 4.41% and 4.44% respectively.
The slump in traditional markets appeared to be a reaction to dismal news that the United States surpassed more than 200,000 Coronavirus cases.
Earlier this week the White House also stated that it concurs with the estimate that up to 240,000 Americans could die from COVID-19 within the next 3 weeks.
If true, this would likely extend the time social distancing and mass quarantine policies stay in effect, leading to additional damage to the economy.
As advised by many market analysts, global markets are unlikely to show signs of bottoming until the Coronavirus pandemic is brought under control.
Surprisingly, shortly after equities markets closed BTC price broke from the pattern of lower highs with a sharp upside move which pushed the price to $6,744.
The move came as the Bitcoin price was on the verge of falling below the $6,200 support to complete the right shoulder of a rather sloppy head and shoulders pattern on the 4-hour time frame.
Had that occurred, traders would be looking at a target near $5,150 so for bulls the current surge above the $6,600 resistance level is probably a welcome relief.
The push through the $6,250-$6,450 range brought Bitcoin (BTC) above the $6,600 resistance and even though the price pulled back, traders are fighting to turn this level to support.
Once above $6,600 traders will target $6,725 and $6,900.
On the daily timeframe, the volume profile visible range shows that above $6,900, the $7,100 to $7,200 zone could present stiff resistance.
For the short term, holding $6,600 as support then setting a higher high above $6,900 would be a positive step forward.
Could Stablecoin Holdings Tip the Scale in BTC Bull’s Favor?
One factor that could bolster bulls eventually is the fact that the Stablecoin Supply Ratio is currently nearing an all-time low, showing that the current stablecoin supply has significant buying power and could bolster BTC.
“Stablecoin Supply Ratio (SSR) is near its ATL. Low SSR means the current stablecoin supply has strong buying power to purchase BTC and push the price up. USDT (ERC20) exchange balances at an ATH indicates that those coins are waiting on the sidelines,” Glassnode noted in a recent tweet.
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DISCLAIMER: This is NOT financial advice. The views and opinions expressed in this video are just opinions, nothing more. Trading is very risky, especially when trading with leverage. Seek financial advice from a professional and trade at your own risk because I am not responsible for any investment decisions that you choose to make.