- Bitcoin sliced through $56,000, increasing speculation that it would soon hit all-time highs around $58,000.
- Supply on exchanges continues to increase as investors prefer to hold their coins in illiquid form.
- A correction may come into the picture if the MACD indicator flips bearish on the 4-hour chart.
Bitcoin has been under pressure from speculators that it hits its record highs above $58,000. The flagship cryptocurrency has had an unbroken winning streak since the drop to $42,800 in February. The most recent spike above $56,000 paved the way for gains eyeing $58,000 and $60,000, respectively.
Bitcoin hunts for crucial support
The bellwether cryptocurrency is trading slightly above $55,000 following a minor rejection from $57,448. The need for higher support is to ensure that BTC remains stable in the quest for higher levels.
For instance, settling above $56,500 means that Bitcoin has conquered one of the key resistances toward $60,000. Besides, a break above $58,000 will be a huge milestone likely to trigger massive buy orders as buyers anticipate the breakthrough to $60,000.
BTC/USD 4-hour chart
The bullish narrative will continue to hold water if the Moving Average Convergence Divergence (MACD) sustains the bullish impulse. The MACD line (blue) is above the signal line, suggesting that the uptrend is still in place.
Meanwhile, data by Santiment shows that Bitcoin supply on exchanges has been relatively stable from the beginning of March. In other words, the BTC market is enjoying stability as bulls focus on higher levels.
However, the same metric, Coin Supply on Exchanges (as a percentage of total supply in USDT), has fallen to a 40-day low. Note that a slump in exchange supply reveals decreasing selling pressure. In other words, the price tends to move higher as coin supply on exchanges diminishes.
Bitcoin supply on exchanges
The Age Consumed on-chain metric has printed a massive spike, suggesting that Bitcoin is about to make a big move. This metric “tracks the movement of previously idle BTC tokens.” It is adjusted to show Bitcoin moving from one address to another each day multiplied by the days it has been idle. Usually, spikes in Age Consumed culminate in significant price action either north or south.
Looking at the other side of the fence
Bitcoin will fail to clear the resistance at $56,500 if the MACD flips bearish. A slide of the MACD line under the signal line would be a bearish move, leading to intense overhead pressure. Moreover, support at $54,000 must remain intact to ensure that bulls keep their focus on $58,000 and $60,000.