$92K Bitcoin barrier: Can BTC smash through, or will traders take profits?

• Bitcoin has made steady gains over the past three weeks on the back of rising demand.
• The liquidation heatmap showed that the $91k level could see a bearish reversal.

Bitcoin [BTC] was inching higher on the price chart. Over the past three days, it was able to break above a month-long descending trendline resistance and achieve a 4.5% price gain.

The dollar sell-off saw the U.S. Dollar Index (DXY) reach its lowest level since 2022, accompanied by rising BTC prices.

The argument that investors are fleeing to gold as a hedge against uncertainty had weight – gold was reaching a new all-time high, but the same does not hold for BTC.

The crypto asset has been in a steady downtrend for three months alongside the falling DXY, and the past ten days’ gains don’t necessarily mean it’s a safe asset.

The Texas Bitcoin Strategic Reserve Act will see deliberation on the 23rd of April. Seeking to add $500 million annually, the state would be the first in the U.S. to formally hold BTC in its balance sheet, if the act is passed.

Technical analysis showed BTC bulls were cooking

Source: BTC/USDT on TradingView

The aforementioned trendline resistance (white) was retested as support on Sunday, the 20th of April.

This breakout was accompanied by a steady uptrend on the OBV over the past three weeks, showing that buying pressure was prevalent.

A daily session close above $87.5k would flip the BTC swing structure bullishly, signaling a long-term uptrend was possible. The RSI was at 59, showing that bullish momentum was building.

However, the $92k level represented the lows of a former range, marking it as a strong resistance level.

A rising BTC while the Dow Jones Index (DJI) fell nearly 1000 points on Monday suggested crypto decoupled from the traditional markets.

Yet, this was the time when swing traders needed to brace for increased volatility and a potential reversal.

Source: Coinglass

The 3-month liquidation heatmap of Bitcoin indicated that the recent rally could see a bearish reversal at $89.2k-$91k. The price generally gravitates toward liquidity.

The liquidity pocket up to $91k saw a build-up of short liquidations since the 23rd of March.

Beyond $91k, the $100k was the next notable magnetic zone. The intervening region also had sizable liquidation levels. Below the current market price, the next liquidity pocket was at the $82.7k support.

The chances of a sustained move higher were hurt by these reversal zones, and traders should be cautious as the price approaches $91k.

Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion