The bitcoin price is trying to break the $60,000 resistance zone after more than a week of hovering within a small range. Notably, the whale clusters in the current market indicate that $57,046 and $60,045 are the critical support and resistance zones in the near term.
In that context, the possibility of a major breakout in the near and mid-term would increase considerably in case bitcoin manages to remain above $57,046 and continues to test the $60K resistance.
Why Are These Whale Clusters Important
Whale clusters mainly form when the high-net-worth investors buy or sell BTC at a specific price and decide not to move their holdings thereafter.
Hence, a whale cluster support normally serves as a major macro support zone for BTC since the whales seem to buy more when bitcoin drops to a level where they originally bought the coins.
On the other hand, a whale cluster resistance is described as the area that might hold up as a sell zone since the whales are expected to wait until their breakeven price o sell their positions.
Based on the researchers at Whalemap, the two critical resistance zones for BTC in the short term are $60,045 and $61,062. On Wednesday, the researchers noted:
“$BTC is back. Bouncing perfectly from whale supports so far. This is a good sign: in bear trends, whale resistances work better than supports and vice versa for bull trends. Whale supports are back to business now which means the trend has shifted. April should be quite fun.”
Since that time, the price of BTC has been ranging and even consolidating between the resistance level and the $57K support. Taking this trend into context, the researchers added that this may be the calm before the storm, expecting a surge in BTC’s volatility, which is now at the lowest levels since last November. They stated:
“The support resistance battle is intense. Levels from last week are working pretty well. Bitcoin is being capped by the $60,045 level pretty spot on. Is this the calm before the storm?”
Traders’ Sentiment About BTC Is Mixed
Based on the pseudonymous trader known as Byzantine General, the BTC futures market is becoming majorly overheated. The derivatives market is exploding while the bitcoin futures funding rate is constantly surging above 0.12%.
Averagely, the default futures funding rate of BTC is 0.01%. Hence, the market is overheated by nearly 12-fold. The trader stated:
“This looks pretty bad tbh. A good flush would be a blessing.”
A trader by the name NekoZ stated that the developing technical market structure of BTC on the 4-hour chart indicates that bitcoin might consolidate longer, but he is not bearish in the short term.
The trader said:
“BTC – H4. I see no reason to be bearish on bitcoin. 2 points I am adding to my long. As long as we keep showing higher lows, 0 reason to be worried.”
The traders generally echo the sentiment that BTC might see a minor drop to reset from the hugely overheated derivatives market. Nevertheless, the macro technical structure remains optimistic.