Bitcoin aims for $61,500 target following successful rebound from crucial support examination

Bitcoin has shown resilience by testing key support levels, bouncing back from a sudden drop to $58,000 on August 27. A trader known as Rekt Capital highlighted that a weekly close above $58,447.12 could signal Bitcoin’s return to an important price range, potentially pushing it towards $60,500-$61,500 in the near future.

Analyzing the daily timeframe, the same trader noted that the drop allowed Bitcoin to successfully test its previous downtrend channel’s resistance as support. This successful retest confirmed the breakout, leading to upward momentum. Bitcoin now appears poised to fill a new CME gap between $60,500 and $61,500, with every previous gap in the past six months being filled.

CME gaps refer to the differences between the closing and opening prices of Bitcoin futures contracts on the Chicago Mercantile Exchange. Typically, Bitcoin’s price moves to close these gaps between the spot and futures markets.

The recent price drop was not triggered by any significant developments in the crypto or macroeconomic landscape. Aurelie Barthere, a Principal research analyst at Nansen, explained that the market has been volatile since March, with the flash crash being a regular occurrence following Bitcoin’s rejection at the $62,000 resistance level.

This sudden movement led to $110 million in liquidations within an hour, as reported by Coinglass. In the US, spot Bitcoin exchange-traded funds (ETFs) experienced $127 million in outflows, with ARK 21Shares’ ARKB seeing the most significant negative flows as $102 million exited the fund.

Contrastingly, the outflows observed were in stark contrast to the nearly $203 million influx into US-traded Bitcoin ETFs on Monday, primarily driven by BlackRock’s IBIT attracting over $224 million in inflows.

The market’s reaction to the recent price movements underscores the ongoing volatility in the crypto space, with Bitcoin’s resilience in testing key support levels and potential for a bullish breakout garnering attention from traders and analysts alike.