Bitcoin Posts Strongest Gain Since May Hinting At Potential $107K Rally

TLDR

• Bitcoin’s daily gain of 5.81% is its strongest since May 8, signaling possible rally to $107K.
• A close above $96K would confirm the bullish trend, with targets around $102K-$107K.
• Aggressive buy-side flows and positive Coinbase Premium show renewed institutional interest.
• Strong volume and bullish break above $92.3K point to a trend shift in Bitcoin’s market structure.

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Bitcoin posted its strongest daily gain since May, gaining 5.81% in a single day, sparking optimism in the market. This surge marks a possible trend shift, with analysts eyeing a rally that could push the price above $100,000. While the rally seems promising, Bitcoin needs to close above $96,000 for full bullish confirmation, signaling a shift in its long-term trend structure.

Strong Daily Gain Reflects Bullish Market Sentiment

On Tuesday, Bitcoin’s price increased sharply, registering its most significant gain since May 8. This movement has raised expectations of a potential rally, especially as a bullish engulfing candle appeared on the daily chart. This pattern indicates a significant change in market direction. The rally’s strength suggests that Bitcoin may be entering a new phase of upward momentum.

The price surge follows a dip below $84,000 on Monday, which shook out some weaker positions and allowed Bitcoin to set a higher high and higher low pattern. This shift suggests that the selling pressure is losing steam, and buyers are starting to dominate. Bitcoin’s structure now shows signs of improvement, but a close above $96,000 remains a critical milestone for full trend confirmation.

Key Levels to Watch for Confirmation of the Rally

Bitcoin’s rally is not yet fully confirmed. Analysts are looking for a daily close above $96,000, which would mark a bullish break of structure (BOS) on the higher timeframe. This level is considered pivotal, as it would confirm that Bitcoin has shifted from a consolidation phase to a clear uptrend.

A break above $96,000 would open the path for a potential rally toward $102,000 and $107,000, where significant liquidity resides. These levels represent previous swing highs, unmitigated stop-loss pockets, and breakout traders’ targets.

The $96,000 mark is critical because it would validate that the recent price surge is not merely a short-term bounce but the start of a more sustainable upward movement. Once Bitcoin closes above this level, analysts expect a surge towards $102,000-$107,000, driven by aggressive buying and the liquidation of stop-loss orders placed near these levels.

Buy-Side Flows and Coinbase Premium Support the Rally

Data from CryptoQuant has shown a strong increase in the buy-to-sell ratio, which reached 1.17, the highest level since January 2023. This spike in buy-side dominance suggests that institutional investors may be returning to the market, supporting the bullish momentum. Buy-side flows typically precede sustained rallies, indicating that structural flows in the market are accelerating.

Additionally, the Coinbase Premium Index, which measures the difference in Bitcoin prices between Coinbase and Binance, has shifted to a positive value of +0.03. This positive premium indicates increased demand from institutional investors, who prefer trading on Coinbase due to its regulatory standing. When combined with rising volumes on Binance and a narrowing price gap between the exchanges, this suggests that global liquidity is improving and supporting Bitcoin’s rally.

Volume Surge Confirms Aggressive Participation

The recent rally in Bitcoin has been accompanied by a surge in trading volume, which is an important indicator of market strength. Strong volume during breakouts typically indicates that the price movement is driven by active participation from buyers rather than being a result of stop-loss hunting or passive market maker activity. This suggests that the current rally could have more staying power, as it is supported by significant demand.

The breakout above $92,300, in particular, marks the formation of a bullish break of structure (BOS), which could lead to further price appreciation. Even if Bitcoin temporarily revisits the fair value gap between $90,000 and $88,000, the market structure remains positive, and further gains are expected.

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