Bitcoin (BTC) surged by 5.81% on Tuesday, marking its highest daily gain since May 8. During this rally, a bullish engulfing pattern emerged, representing the first noteworthy structural change on the daily chart for the fourth quarter. Traders are now considering the likelihood of a continued recovery in the upcoming days.
Key takeaways:
Bitcoin formed a bullish engulfing candle with its strongest daily increase since May, indicating early trend expansion.
A daily close above $96,000 is necessary for complete bullish confirmation.
Buy-side trading surged to its peak during the entire bull market as the Coinbase Premium turned positive.
Bitcoin structure improves, but major confirmation lies above $96,000
BTC’s uptrend on Tuesday created a distinct pattern of higher highs and higher lows following Monday’s liquidity sweep below $84,000, suggesting that sellers are losing strength. The breakout was accompanied by strong volume, indicating demand rather than merely a stop-loss hunt.
High-volume breakouts often lead to more consistent follow-through as they demonstrate active participation from directional buyers, not just passive market makers.
A bullish break of structure (BOS) is now emerging above $92,300. Confirming this BOS would clearly shift the short-term trend upwards, even if BTC temporarily revisits the fair value gap (FVG) between $90,000 and $88,000 while continuing to rise.
The daily chart still lacks full conviction until Bitcoin closes above $96,000. This level is crucial as it represents a BOS on a higher timeframe. Surpassing it would confirm a complete shift in trend structure, not just a relief bounce.
Once $96,000 is reclaimed on a daily closing basis, BTC’s immediate target area expands toward $102,000–$107,000, where a significant cluster of external liquidity remains. This range includes previous swing highs, untouched stop-loss pockets, and liquidity from breakout traders waiting beyond prior resistance levels.
In terms of market structure, these zones can function like magnets; once a decisive breakout clears the final barrier, in this instance, the $96,000 level.
Related: Bitcoin adds $732B in new capital this cycle as market structure transforms
Aggressive buy-side flow and improving premium support the recovery
Data from CryptoQuant showed that the market buy-to-sell ratio jumped to 1.17, the highest level since the cycle commenced in January 2023. Such assertive buy-side dominance typically occurs early in expansion phases when structural flows gain momentum.
Additionally, the Coinbase Premium Index transitioned to a positive value of +0.03 after weeks of selling pressure in the US. Positive premium readings historically indicate renewed demand from institutional investors. Binance spot and perpetual volumes are also rising concurrently, and the price gap between Binance and Coinbase has narrowed, suggesting healthier global liquidity.
Related: Bitcoin Bollinger Bands repeat ‘parabolic’ bull signal from late 2023
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision. While we strive to provide accurate and timely information, Cointelegraph does not guarantee the accuracy, completeness, or reliability of any information in this article. This article may contain forward-looking statements that are subject to risks and uncertainties. Cointelegraph will not be liable for any loss or damage arising from your reliance on this information.
