The dead cat bounces? Bitcoin price nears $23,000 in new 5-month high

Bitcoin (BTC) took a swing at $23,000 in January. 21 as Asian buyers boosted market strength.

BTC/USD 1 hour candle chart (Bitstamp). Source: Trading View

The liquidity of the offers arouses suspicion

Data from Cointelegraph Markets Pro and TradingView showed bear-battling BTC/USD hit $22,790 on Bitstamp overnight – its highest level since August.

With new multi-month highs following in quick succession despite fears of a major correction, Bitcoin continued to surprise as traders paved the way for more upside.

As intraday trader Skew noted, Asia was leading the way at the start of the weekend as selling pressure from market makers was absorbed on exchanges.

“Another rally pulled by Asian bid. TWAP buyers absorb MM selling pressure. Bids lifted big and demand wall pulled ahead of another short squeeze,” Skew commented on a composite chart.

BTC/USD annotated charts. Source: Skew/Twitter

Meanwhile, the on-chain analysis resource Material Indicators reported requesting that liquidity be removed on Binance the day before, allowing Bitcoin’s initial run past the $22,000 mark.

“The volatility continues. Don’t give it all back, make sure you profit along the way,” he wrote in a later update.

BTC/USD order book data (Binance). Source: Materials Indicators/Twitter

As always, Bitcoin was far from above suspicion during its recent highs, with some familiar faces still urging traders to prepare for the worst.

“The bigger the pump, the harder BTC will fall,” analyst Toni Ghinea tweetedwhile Crypto Tony argued that the whole movement may be nothing more than a “dead cat bounce”.

“It doesn’t matter if it’s a dead cat relief wave or a reversal on Bitcoin, it’s great to see some optimism back in Crypto,” he summed up.

Considering why further gains were to come after the week’s TradFi trading ended, one popular commentator also suggested that traders were being manipulative.

“No one who really wants to buy and own crypto waits until Friday close every week to execute,” an update readadding that “the objective of these buyers is clear”.

Earlier in the week, Material Indicators also warned of “choreographed” bidding on BTC.

BTC/USD 1-day candle chart (Bitstamp). Source: Trading View

Key moving average on the horizon

Attention has therefore turned to the upcoming weekly close of BTC/USD which, if current prices were to hold, would be at its best level since mid-August.

At the same time, Bitcoin looked set to print a so-called “death cross” on the weekly chart, with the descending 50WMA poised to cross the still rising 200 WMA.

BTC/USD 1 week candle chart (Bitstamp) with 50, 200WMA. Source: Trading View

Related: Bitcoin Faces Crash of $15,000 as US Triggers ‘Financial Collapse’ – Arthur Hayes

A major target was the 200-week moving average (WMA), currently at $24,650 and out of reach for much of 2022.

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