Bitcoin eyes $61,500 after rebounding from key support test

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Bitcoin (BTC) is successfully testing key weekly support, despite quickly crashing to the $58,000 price level on August 27. According to the trader identified as Rekt Capital, a weekly close above $58,447.12. could confirm BTC has returned to an important price channel, potentially helping it reach the $60,500-$61,500 area in the near term.

On the daily time frame, the trader added that the crash also served as an opportunity for Bitcoin to successfully test the resistance of its previous downtrend channel as support.

In particular, Rekt Capital explained that a successful retest of this daily support would fully confirm the breakout and precede the upward continuation that ended up happening.

As a result, Bitcoin could be preparing to fill a new CME gap located between $60,500 and $61,500, as the trader pointed out that BTC has filled every gap recorded in the last six months.

CME spreads are the deviations between the closing and opening price of Bitcoin futures contracts traded on the Chicago Mercantile Exchange (CME), hence the name. BTC price usually moves to cover discrepancies between the spot and futures markets.

Sudden but regular accident

Yesterday’s crash was not linked to any major developments in crypto or the macro economy. Aurelie Barthere, Senior Research Analyst at Nansen, shared with Crypto Briefing that the market has been choppy since March and the flash dump is just a regular move after Bitcoin was rejected at the $62,000 resistance.

“This could explain the big red price candle for BTC yesterday,” she added.

Despite being a common move, the sudden impact caused $110 million in liquidations in an hour, according to Coinglass data.

US Spot Bitcoin Exchange Traded Funds (ETFs) also had a tough day, with $127 million in outflows recorded, according to Farside Investors DATA performances. However, unlike the usual capital fleeing Grayscale’s GBTC, ARKB ARK 21Shares saw the most negative flows as $102 million left the fund yesterday.

Notably, the flows seen yesterday contrast sharply with the nearly $203 million directed to US-traded Bitcoin ETFs on Monday, driven primarily by BlackRock’s IBIT which captured more than $224 million in flows.

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