Bitcoin Price Reaches Critical Resistance Zone
After a period of upward momentum, Bitcoin has reached a crucial resistance zone where the 100 and 200-day moving averages intersect. This is a significant juncture that could determine whether the price undergoes a pullback and enters a downtrend or breaks through the zone and aims for the $30K mark.
The Daily Chart
On the daily chart, Bitcoin experienced consolidation around $25K before entering an uptrend. The bullish move pushed the price towards a significant resistance region at $28K, where the 100-day and 200-day moving averages converge. There is a high probability of rejection at this area, leading to a potential pullback and sharp downtrend. However, buyers may hold the price and push it above the moving averages, reinstating bullish sentiment.
Monitoring the price action closely in the coming days is crucial due to increased volatility expected in the medium term.
The 4-Hour Chart
Looking at the 4-hour timeframe, Bitcoin found strong support at $25K after a decline. The subsequent uptrend saw the price surpass previous highs consistently, indicating growing interest. However, Bitcoin has been trading within an ascending channel and was rejected from the upper trendline for the third time. This suggests dominant sellers and potential for another downward movement.
If the price unexpectedly breaks through this critical resistance region and shows strength, it could surge towards $30K. The market’s response to these levels will determine Bitcoin’s short-term trajectory.
On-Chain Analysis
Transaction Count (Mean)
The recent bounce in Bitcoin’s price has led to increased network activity. The on-chain transaction count is commonly used to measure this activity, and historically, it has shown a positive correlation with Bitcoin’s price, indicating that increased activity often leads to price rallies.
The 7-day moving average of the mean transaction count has been increasing since Bitcoin’s rise towards $30K. However, there has been a recent sharp drop in transaction counts, which is not a positive sign and could have a negative impact on the market soon. If network activity does not pick up again, the price may experience a decline shortly.
Hot Take: Bitcoin at Critical Resistance Zone
The price of Bitcoin has reached a crucial resistance zone where the 100 and 200-day moving averages intersect. This zone presents a pivotal moment for Bitcoin, as it could either experience a pullback and enter a downtrend or break through and aim for the $30K mark. The daily chart shows the importance of this resistance area, with a high probability of rejection leading to potential bearish momentum. On the other hand, if buyers manage to hold the price above the moving averages, bullish sentiment may be reinstated. Monitoring the price action closely is essential due to expected volatility. Additionally, on-chain analysis indicates that network activity has recently dropped, which could negatively impact the market if not picked up again.
By
By
By
By
By
By