Bitcoin Price Faces Rejection Despite Positive Developments
Bitcoin’s price has experienced a significant 17% decline, despite positive developments such as the approval of Bitcoin spot ETFs by the U.S. Securities and Exchange Commission. However, there is potential for a renewed bullish movement as the cryptocurrency approaches a crucial support region.
Technical Analysis
Analyzing the daily chart, Bitcoin’s attempt to overcome the resistance at $48K was met with rejection, leading to a decline towards a critical support region at $39K. This support level, which includes the middle boundary of an ascending channel and the 200-day moving average, could trigger a renewed bullish surge if it holds. However, a break below the 200-day moving average could result in a cascade of sell-stop orders and a long-squeeze event.
On the 4-hour chart, Bitcoin broke below the lower boundary of an ascending flag after facing rejection at $48K. A retracement towards the flag’s lower boundary is currently underway, potentially completing a pullback before continuing its downward movement. In the mid-term, Bitcoin is expected to consolidate within the range of $48K resistance and $39K support.
On-chain Analysis
Analyzing sentiment in the futures market can provide valuable insight into Bitcoin’s sustainability. The funding rates in the futures market have experienced a significant decline but still remain positive. This suggests that while there has been a short-term correction, sentiment remains bullish and the futures market has cooled off from being overheated. As a result, there is a possibility that Bitcoin’s price might continue its upward trajectory after completing the current correction stage.
Hot Take: Potential for Bullish Movement Despite Recent Decline
Despite Bitcoin’s recent price decline, there is potential for a renewed bullish movement as the cryptocurrency approaches a crucial support region. Technical analysis indicates that if the support at $39K holds, Bitcoin could experience a renewed surge in price. On-chain analysis also suggests that sentiment remains bullish, indicating the possibility of further upward movement in the future. While there are concerns about sustainability and short-term consolidation, there are positive signs that Bitcoin’s price may continue its upward trajectory.
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