Is Bitcoin Price Heading Back to $40000?
The Bitcoin price recently experienced a bearish reversal from the $44500 resistance level, resulting in a 4.5% drop within a week. This is the second time in a month that the price has retreated from this level, indicating significant supply pressure. On the daily time frame, these downward movements form a bearish reversal pattern known as a double top.
Possible Correction Phase
- The breakdown below the $40280 neckline support could trigger a correction phase for the BTC price.
- If the price continues to fall, it may find support at around $38000 and $35500.
- The intraday trading volume for Bitcoin is currently at $26.5 billion, representing a 20% increase.
In December, Bitcoin has been trading mostly sideways between the levels of $44500 and $40280. This lack of significant movement has created uncertainty in the market.
However, the struggle to surpass $44500 has led to the formation of a double bottom pattern, which often occurs at local tops during rallies. Currently, Bitcoin is trading at $42352 with an intraday loss of 3.25%.
Based on this pattern, there is a likelihood that the price will break below $40280 and end the consolidation phase in a bearish manner, intensifying selling pressure. If this breakdown occurs, the price could drop by 12% to reach the support zone of $36000-$35500.
Is BTC Price Ready For a Bull Run?
Although the short-term outlook for Bitcoin appears bearish, the broader trend remains bullish according to the Fibonacci retracement tool. If the price drops to $35500, it may also reach the 50% FIB level, providing additional support for buyers. This type of retracement is often seen as a healthy correction as buyers regain their momentum.
Furthermore, the Securities and Exchange Commission (SEC) has given ETF applicants until December 29, 2023, to finalize revisions to their proposals. This suggests a potential step forward towards ETF approval in the United States, contributing to bullish sentiment in the market.
- Exponential Moving Average: Breaking below the 20-day EMA slope would indicate an upcoming correction for ETH price.
- Moving Average Convergence Divergence: The bearish crossover between the MACD and signal line suggests an ongoing correction trend.
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Hot Take: Will Bitcoin Price Bounce Back or Continue to Fall?
The recent bearish reversal in Bitcoin’s price has raised concerns among investors. While there are signs of a correction phase and potential support levels, it remains uncertain whether the price will bounce back or continue to fall. The upcoming SEC decision on ETF approvals and overall market sentiment will play a crucial role in determining Bitcoin’s future direction. As a crypto reader, it’s important to stay updated on the latest developments and analyze the market trends before making any investment decisions.
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