Analysts claim “mega whales” will make it very difficult for BTC traders to flip $20,000 to support.
Bitcoin (BTC) staged a welcome comeback after the Sept. 28 Wall Street open as bulls faced off with whale-sized sellers.
Whales lie in wait at $20,000
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD gaining over $1,000 on the day to see highs of $19,656 on Bitstamp.
The move characteristically copied an uptick for United States equities, with the S&P 500 and Nasdaq Composite Index up 1.5% and 2.2%, respectively.
Now, analysis warned that the area of around $20,000 was still flush with large-volume traders eager to continue profit-taking.
The BTC/USD chart on major exchange Binance “shows brown Mega Whales dumping into BTC support to minimize slippage,” analytics resource Material Indicators commented.
An accompanying snapshot confirmed the bulk of resistance lying in wait at just below the $20,000 boundary.
“Let's see if $19.5k holds to set up another potential run at the R/S flip zone ~$20k,” Material Indicators added.
To the downside, meanwhile, analyst Maartunn, a contributor to on-chain analytics platform CryptoQuant, noted a large area of bid interest between $18,000 and $18,500.
This was worth around $65 million as of Sept. 28, potentially forming a cushion of support.
As Cointelegraph reported, the area below June’s $17,600 low is conversely devoid of bid support, opening up the potential for a cascade toward $12,000.
In terms of the strength of the current bounce, traders were skeptical, with popular Twitter account Cheds cautioning on exposure with “bulls starting to celebrate.”
At the time of writing, BTC/USD traded around the $19,500 mark.
Related: More ancient Bitcoin leaves its wallet after 10-year hibernation
Dollar slumps after latest two-decade high
On macro, the story of the day was the United Kingdom’s central bank returning to quantitative easing (QE) after financial turmoil hit its currency and bond market.
The Bank of England sparked an instant recovery for GBP/USD after the pair hit all-time lows.
The U.S. dollar, already coming off twenty-year highs, continued to give back gains.
The U.S. dollar index (DXY) looked set to return below 113 at the time of writing, down a full 1.5 points on the day.
“Looks like we'll finish the week out strong for Bitcoin and Stocks as we head into Pumptober,” a hopeful IncomeSharks reacted.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.