Bitcoin’s CVD Divergence And Limit Buyers Signal Crucial $37K! Can Spot Bulls Offset Selling Pressure At $36,500? 

In the past few hours, Bitcoin has experienced extreme volatility after declining from its $38K peak. This seesaw movement is the result of a battle between buyers and sellers, with the BTC price initially dropping to a low of around $36.5K before facing a surge in buying interest that brought a recovery. This activity is particularly seen in the derivatives market, and several key indicators are now signaling a critical trading session. 

BTC Traders Battle For An Advantage

Over the last day, Bitcoin’s drop from a high of $38.5K to $37K resulted in a rise in total liquidations. Data from Coinglass reveals that Bitcoin triggered $22 million in total liquidations, with long positions making up approximately $15.6 million of this figure. This has erased buying hope as the price lost its momentum it gained towards the $38K level.

However, buyers are bullish as the Cumulative Volume Delta (CVD) shows a divergence, indicating that while the price of Bitcoin is hovering around $37K, there is a massive shift in the volume of trades. A divergence in CVD suggests that despite the price decline, there is a volume of buying happening in the background, which could signal a correction. 

Another indication is rising limit buyers around the $37K mark. Limit orders are set to buy or sell a security at a specific price. The concentration of limit buy orders around this level indicates that traders are anticipating this to be a favorable entry point, expecting the price to bounce back up. 

Interestingly, any further decline will result in a bullish surge as spot bulls will start stepping in aggressively in the $37K to $36.5K range. This move might lead to an absorption of the ongoing selling pressure.

What’s Next For BTC Price?

Bitcoin’s recent uptrend is facing resistance near $38,000, yet there’s no rush from the bulls to exit their positions, suggesting an expectation for the upward trend to continue. As of writing, BTC price trades at $36,958, declining over 1.4% from yesterday’s rate. 

Currently, Bitcoin finds immediate support at the 100-day exponential moving average (EMA) on the 4-hour price chart. A rebound from this level would imply that traders are eagerly buying on each minor dip. However, the price is currently moving within a specific range, and a breakout will create increased pressure. 

Should Bitcoin break above the trend line, it might climb towards the $40,000 mark. However, this price point could present a challenge. On the other hand, a fall below the support would suggest profit-taking by traders, possibly leading to consolidation within $34K-$35.5K.

While bulls are attempting to keep the price above the moving averages, overcoming the $38K threshold remains a challenge. The Relative Strength Index (RSI) is hovering below the midpoint at 39, hinting at a bearish dominance.