Bitcoin has potentially broken out of a falling wedge formation this morning, with a USD price spike of over 5% in value.

The breakout looks to fulfill conditions for a falling wedge reversal in price (over shorter timeframes) with a decent amount of follow-up volume trading after the move up on most exchanges. According to the latest data on Bitcoinity, we can see that the premium between Tether and non-Tether exchanges is currently trading at close to 4%.

During the initial move up, the premium between Bitfinex and Bitmex perpetual swap contracts climbed to over 8%.

We saw Bitcoin trade at a high of $3,600 on Bifinex, while the Bitmex contract only reached a high of $3,400 on the first pump. Since then, we have seen the Bitfinex and Bitmex price gap reduce to under 5%.

Move driven by spot buys and not margin buys

Looking at the buying pressure on Bifinex, we can see the move was predominantly driven by spot buys, as we have not seen any major moves in margin shorts or longs opening at the time of the move.

According to the latest data on Datamish, we saw a drop in margin shorts and longs in the hours preceding the price breakout. This resulted in the margin interest of both shorts and longs reducing by around 1,000 BTC, from their local peaks of 40,000 BTC for shorts and 35,500 BTC for longs.

To learn more about the Bitfinex margin ratio, check out the recently published premium guide on Crypto sentiment with BTC margin longs and shorts.

It’s also interesting to note that at the time of the move, we saw over 4,000 BTC trade over a two-minute period on Bitfinex as price broke out from over $3,400 resistance to trade as high as $3,600 on Bitfinex.

Not just Bitcoin pumping

It’s not just Bitcoin that has seen a reversal in price this morning. Most other large-cap crypto projects have broken out in USD terms, but remain similarly priced in terms of BTC.

It’s worth noting that we also saw a move in the USTD/USD stablecoin market at the time of the spike. On Bitfinex, we saw the price of Tether break out with $0.5 million worth of buying pressure causing upwards movement of over 0.5%, taking the price of Tether from $1.03 to $1.036.

Support at the 200-week moving average

Just yesterday, Bitcoin traded just below the long-standing support of the 200-week moving average.

Bitcoin looks to have bounced directly off this support, but it’s too early to proclaim that this may actually be the bottom just yet.

So far, the market is still digesting the breakout in price, but if the move carries on upwards, then we need to see continued spot buying volume if we’re to push through resistance on Bifinex at $3,600 and then the $3,800 price level.