Accumulation or distribution? Decision Time for Bitcoin After FTX Drops Binance Industry Offer – Bitcoin (BTC/USD)

Bitcoin BTC/USD jumped nearly 6% at one point during Monday’s 24-hour trading session before selling off to trade mostly flat by mid-afternoon.

The short return took place after Binance CEO and founder Changpeng “CZ” Zhao took to Twitter to try to calm investor fears about the liquidity crunch caused by the decimation of Sam Bankman-Fried’s FTX trading platform last week.

Zhao announced that he is forming an “industry recovery fund” to support “strong” companies and projects in the crypto sector that are struggling with liquidity, according to a report.

The FTX debacle caused traders and investors to start withdrawing their crypto due to fears that the platform’s ruin would have a ripple effect on other exchanges.

As Bitcoin dipped below the $16,000 mark, bulls came in and defended the area, indicating that the level acts as a strong support zone for the crypto. The area also acted as support on November 10, causing a huge 11% rally that day.

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The Bitcoin Chart: In the last five 24-hour trading sessions, Bitcoin has largely traded sideways within the November 9 range, prompting the crypto to form five inside bars. The inside bars are mostly decreasing in volume, which confirms consolidation.

• The consolidation can either be accumulation for a move higher or distribution for a move lower. The inside bars are bearish because Bitcoin traded lower recently, but positive news in the sector could cause the crypto to break bullishly from the range and return to an uptrend.
• The recent short returns, along with sideways trading, have caused Bitcoin’s Relative Strength Index (RSI) to reverse from oversold territory, but the indicator remains low at around 35%. If Bitcoin breaks bearishly below $16,000, there will likely be an immediate oversold return because it will drop the RSI below 30%.
• If Bitcoin breaks out of the mother line on November 9, the crypto will regain the eight-day exponential moving average as support, which will give bulls more confidence going forward. If that happens, Monday’s intraday low could act as a higher low, which could also indicate an uptrend on the horizon.
• Bitcoin has resistance above at $17,580 and $19,915 and support below at $16,000 and $15,000.

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