Bitcoin: The curious case of the weekend pump

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Disclaimer: The information presented does not constitute financial, investment, trading or other advice and reflects the opinions of the authors only.

The upward movement was accompanied by a sharp rise in the OI. Longer-term sentiment remained bearish.

US debt ceiling negotiations on Saturday saw Democrats and Republicans reach a tentative agreement. This was good news for the market as it averted the disaster of a US debt default.

Read bitcoins [BTC] Price Prediction 2023-24

This seemed to lift the spirits of market participants. Likewise, bitcoins [BTC] prices went from $26.6k to $27.2k. We say pump, but it was only a 2.7% move higher over the weekend. Will the bulls be able to reverse the losses seen earlier this month?

Bitcoin is witnessing a short-term range formation below resistance

Source: BTC/USDT on TradingView

For over two weeks, Bitcoin has been trading below the $27.8,000 resistance. This was a major resistance level due to its importance in early April. The price retested this level as support several times in late April and early May as well.

Eventually the buyers succumbed and he was knocked down by resistance. At the time of writing, the two levels to watch on the lower timeframes were the $27.8,000 resistance and the $26,000 level. A range (orange) was spotted that extended from $26.1k to $27.6k.

The RSI was in overbought territory on the 2-hour chart after BTC broke above the mid-range mark at $26.8,000. Although this is a big move in the range, the big picture shows that the bears still have the upper hand.

A look at the daily and 4-hour charts showed a bearish market structure. This would have reversed into bullish favor on a move above $27,800, but traders should be wary of liquidity hunts in the $28,000 area. It could take a few trading days for Bitcoin to see acceptance above $28,000. Until then, buyers can remain cautious about market intentions.

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A strong performance from bull speculators clarified sentiment

Source: Coinanalysis

Bitcoin gains of 2.7% saw nearly $400 million added to Open Interest. The surge in OI alongside rising prices showed that speculators were mostly bullish. The funding rate has dipped in recent hours but remained positive.

Overall, a move to the $27.6k to $28k region was possible. Still, it remained likely that Bitcoin would face a price chart rejection and reversal from there.

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