These two critical levels will determine the mid-term trajectory of BTC – Bitcoin Price Analysis

After an extended sideways consolidation phase, Bitcoin experienced a downtrend, touching the significant support zone around $60,000. However, expectations point to a resurgence of buying pressure, which may lead to a rally.

Technical Analysis

By Shayan

The daily chart

A close look at the daily chart reveals an extended period of sideways consolidation within the pivotal $60,000-$72,000 price range, with recent price action seeing a decline towards the lower end of that range.

Bitcoin is currently in a crucial support zone, spanning between the Fibonacci retracement levels of 0.5 ($62,181) and 0.618 ($59,444), in alignment with the vital 100-day moving average at $59,000.

This support region is of major importance and could lead to a short-term bullish reversal. However, a sudden and unexpected breach below this critical level could catalyze a long-duration event, leading to a notable downward move.

Source: TradingView The 4-hour chart

Analysis of the 4-hour chart reveals increased selling pressure following Bitcoin’s inability to recover the upper boundary of the descending wedge. This resulted in a noticeable downtrend towards the lower trendline of the wedge, around $60,000.

Upon reaching this crucial level, the selling pressure found sufficient demand, which led to a small consolidation phase. However, sellers remain determined to breach the lower bound of the wedge.

If buyers regain control and the price finds support around this critical level, a bullish bounce towards the previous high of $68,000 could occur. However, the $60,000 mark is currently Bitcoin’s main reference point, with price action around it likely dictating the cryptocurrency’s short-term trajectory.

Source: TradingView chain analysis

By Shayan

Bitcoin continues to endure a prolonged consolidation phase, with the price approaching the $60,000 threshold. Given this scenario, a deeper analysis of sentiment within the futures market can provide valuable insight into its potential trajectory.

The chart provided provides insight into funding rates, a fundamental metric that measures the dominance of buyers or sellers in market dynamics. Upon examination, recent corrective pullbacks have resulted in a significant drop in funding rates, approaching near-zero levels.

This decline represents a favorable development in the long term, as it relieves the pressure of new liquidations and lays the foundations for the resurgence of both long and short positions in the perpetual market. Consequently, the market seems poised to embark on a renewed impulsive trend, ending the prevailing phase of uncertainty and lateral consolidation.

Source: CryptoQuant

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