Bitcoin's recent surge past $50k sparks bullish sentiment, but Korean Premium Index signals caution. Market sentiment remains neutral as liquidation levels suggest short-term downside risks. Analysis on potential price movements and liquidation levels.
Bitcoin soared to new heights in February, breaking through the significant psychological barrier of $50k.
This surge has instilled a strong bullish sentiment in the market, evident from the increasing Open Interest associated with BTC, according to data from Coinglass.
However, there's another indicator on the rise, one that typically signals a temporary peak for Bitcoin. The Bitcoin Korea Premium Index peaked at 3.98% on February 16th.
The Korean cryptocurrency market, primarily comprising retail traders due to regulations against institutional investors, provides valuable insights into sentiment.
The KPI spiked to 5.43% on January 12th when BTC was priced at $42.8k, followed by a drop to $39.5k ten days later. The recent surge in the KPI has raised concerns of a potential price correction.
Analysis of Open Interest data on shorter timeframes indicates subdued market sentiment over the past five days. Coinalyze data suggests neither buyers nor sellers have gained a clear advantage.
Annotated in purple is the trading range Bitcoin has maintained over the past five days, spanning from $50.6k to $52.5k, with $51.5k acting as a pivotal support-resistance level.
Following the earlier bullish momentum this month, Bitcoin bulls are consolidating their gains. However, declining On-Balance Volume (OBV) suggests waning bullish momentum.
AMBCrypto's analysis of liquidation levels data from Hyblock reveals a negative Cumulative Liquidation Levels Delta over the past four days.
This imbalance indicates a prevalence of short liquidation levels over longs.
As a result, prices are likely to target short liquidations first before a potential reversal. Notably, there are two significant liquidation levels at $53.1k and $52.8k, totaling $180 million and $211 million, respectively.
It's anticipated that Bitcoin may ascend to these levels, possibly reaching as high as $53.6k, before a bearish reversal and a subsequent hunt for long liquidations in the following week or two.