Bitcoin eyes $58K as spot-driven BTC bounce makes rally 'look sustainable'

Organic growth from spot traders opens up key resistance levels closer to $60,000 for BTC/USD, analysts argue.

Bitcoin (BTC) is riding high on the back of a “very low and healthy” indicator, according to one market analyst, which could propel it to a key resistance level at $58,000.

In a tweet on April 27, analyst Lex Moskovski noted that futures funding rates are suggesting this week’s BTC price run has been completely organic.

“Low and healthy” funding rates buoy bulls

Funding rates are a popular metric for measuring the health of BTC price movements. They essentially show which traders are on the right side of the bet (long or short) — a high funding rate on a platform means longs are “paying” shorts, while low funding rates imply the opposite.

Negative rates are what analysts look for when determining if any upside is likely to endure, or is due in the short term.

Currently, conditions are right — the move up to $55,000 was likely not fueled by speculative trading action, says Moskovski.

“Funding is very low and healthy,” he wrote.

“This run up in Bitcoin came from spot and looks sustainable.”

*BTC futures perpetual funding rates vs. BTC/USD. Source: Lex Moskovski/ Twitter*

Long-term trends remain firmly intact

How high BTC/USD could go and still remain sustainable is Tuesday’s topic of debate among technical observers. For Sven Henrich, creator of analysis firm NorthmanTrader, key Fibonacci levels in particular are worth eyeing.

Specifically, the 0.618 Fibonacci level, as ever a source of support and resistance aims, now sits at just above $58,000 — also the site of a Bitcoin all-time high from February, which held for multiple weeks.

*BTC/USD 1-day candle chart (Bitfinex) with Fibonacci retracement levels. Source: Sven Henrich/ Twitter*

Henrich and popular Twitter account Rekt Capital meanwhile highlighted moving averages and a 76-day technical uptrend as key to determining support. These have contained BTC/USD throughout recent price dips, with the 100-day and 21-week figures regarded as a line in the sand for bulls.

“Price pulled back towards it on the retrace but in the end didn’t actually touch it. It didn’t have to,” Rekt Capital commented about the 76-day trend.

Both perspectives indicate that beyond the short term, Bitcoin has not crossed any red lines, which could spell the end of its bull run.