Bitcoin is looking higher, having ping-ponged over a narrowing price range for the past few days. Despite signs of a breakout, some analysts remain cautious.

  • Bitcoin has risen 8% this week to trade above $38,500, according to CoinDesk 20 data.

  • Crypto funds are deploying newly subscribed capital, which seems to be pushing the cryptocurrency higher, according to Stack Funds’ Co-Founder and COO Matthew Dibb.

  • “[Limited Partners] are buying the dip, and the new start date for capital deployment/allocation is generally the first day of month,” Dibb told CoinDesk.

  • The rally appears to be a low-leverage, spot-driven move. Funding rates – the cost of holding long positions in the perpetual futures – remain close to zero, according to data provider Glassnode. A high funding rate is taken to represent excess leverage on the bullish side.

  • The daily chart shows the cryptocurrency has broken out of its two-week-long symmetrical triangle (congestion) pattern and further gains may be in the offing.

  • “Bitcoin is looking much better technically,” Dibb said. “However, we would need to see a weekly close above the previous short-term high of $40,904 to regain confidence of a resumed uptrend.” The weekly close is Sunday at UTC 23:59.

  • Pankaj Balani, co-founder and CEO of the Singapore-based Delta Exchange, expects recovery rallies to be short-lived.

  • “We expect selling to resume and large supply being offered above $45,000,” Balani said.

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