Bitcoin (BTC) price rebounds above $80,000 after constant drawdowns

The top cryptocurrency managed to rebound above $80,000 after a brief decline below the range on March 11.

Bitcoin (BTC) price threatened a quick return to $90,000 on March 12, as U.S. inflation data threatened to throw a lifeline to the cryptocurrency markets.

Bitcoin stalls ahead of crucial resistance

After sliding to lows of $76,600 on March 9, Bitcoin staged a recovery attempt to retest the overhead resistance zone between $84,000 and $85,000 three times.

This move spurred traders to aggressively build up short positions in this range.

Liquidation heatmap data from CoinGlass showed that over $300 million in short positions were piled into this price region, which would be liquidated if the price moved above the $85,000 resistance.

With a lack of downside liquidity below $77,000, the probability of BTC moving toward upside liquidity increased.

Moreover, triggering liquidations above $85,000 could fuel further bullish momentum, allowing Bitcoin to form a higher high and turn this level into new support.

A CME Bitcoin futures gap from the previous weekend also remained unfilled between $85,000 and $86,000. With a 100% record of six gaps being filled in the past four months, this setup further increased the chances of flipping the overhead resistance into support at $85,000.

If this happens, the next major resistance lies at $90,000, which could liquidate over $1.6 billion in short positions for a retreading of the $95,000 resistance level above, i.e., a 12% jump from the current price.

Bitcoin analyst Mark Cullen highlighted a similar outlook for Bitcoin but warned that the price continues to move “correctively,” implying further sideways movement before a short squeeze.

On the contrary, Valeria, a crypto analyst and funded trader, said that BTC was showing signs of distribution near the $85,000 range, which is short-term bearish. The trader highlighted that the BTC price might thread lower below $80,000 before a bullish breakout occurs.

Coinbase, Binance diverge in orderbook trends

Looking at the overall market trends, Aggr.trade data showed that spot traders on Binance have been aggressively selling over the past few days, with selling pressure peaking during the local lows at $76,650.

Conversely, Coinbase spot buyers were the ones who placed bids here, leading to BTC’s rebound above $80,000.

On March 12, a similar discrepancy was observed, with Binance spot traders selling at the $85,000 resistance as Coinbase traders defended the price at $81,000 during the early US trading session, preventing any further downside.

While Coinbase has been spearheading BTC’s rally in recent times, an opposing stance between the two leading exchanges might slow BTC’s momentum to move swiftly through the resistance levels.

Thus, for Bitcoin to reclaim higher highs at $85,000, $90,000 and $95,000 over the next couple of weeks, spot trading activity between the two major exchanges may need more collective direction.