Bitcoin [BTC] is moving higher, having ping-ponged over a narrowing price range for the past few days. Despite signs of a breakout, some analysts still remain cautious.
Bitcoin has risen 8% in the week to trade above $38,500 USD, consistent with CoinMarketCap data.
Crypto funds are deploying newly subscribed capital, which seems to be pushing the cryptocurrency higher, consistent with Stack Funds’ Co-Founder and COO Matthew Dibb.
“[Limited Partners] are buying the dip, and therefore the new start date for capital deployment/allocation is usually the primary day of the month,” Dibb outlined.
The rally appears to be a low-leverage, spot-driven move. Funding rates – the value of holding long positions within the perpetual futures – remain on the brink of zero, consistent with data provider Glassnode. A high funding rate is taken to represent excess leverage on the bullish side.
The daily chart shows the cryptocurrency has broken out of its two-week-long symmetrical triangle (congestion) pattern and further gains could also be within the offing.
“Bitcoin is looking far better technically,” Dibb revealed. “However, we might see a weekly close above the previous short-term high of $40,904 USD to regain the confidence of a resumed uptrend.” The weekly close is Sunday at UTC 23:59.
The co-founder and CEO of the Singapore-based Delta Exchange, Pankaj Balani, expects recovery rallies to be short-lived.
“We expect selling to resume and enormous supply being offered above $45k,” Balani added.