The price of Bitcoin (BTC) has risen in recent months, rising almost 100% from $ 10,000 to $ 19,800. However, the high of $ 20,000 offers significant resistance, causing the price to fall several times, including today, as BTC fell below $ 19,000 on December 4th.

The chances of a correction increase slowly as the volume has decreased in recent days. Several arguments can be made for a deeper correction, which will not necessarily be bad for the market as a whole.

Historically high, great resistance remains

One-day BTC / USD chart. Source: TradingView
As the chart shows, the historical maximum was not broken. However, this is not a surprise, as many retail investors will have record highs in 2017 as an indicator of potential profits. This is the last hurdle before Bitcoin enters pricing, making it difficult to determine the next targets.

Given that the price of Bitcoin has reached a full-time high almost vertically, there does not appear to be a clear break above the all-time high at this point.

However, as long as the price of bitcoin remains in this region, there are several arguments for a possible correction.

In particular, the volume drops sharply after a recent attempt to break through $ 20,000, indicating potential weakness in momentum. Second, current full-time hours open the door to possible bearish deviations from the daily time frame.

This bearish deviation has not yet been confirmed, but it shows some potential signs of a minor reversal of the trend. If true, the main areas to look at are $ 16,000 and $ 14,000.

In addition, the 2014 highs did not beat any party.

The current price action is comparable to the price action in the previous cycle. The 2014 peak was the last resistance, followed by a 30% correction.

This correction often leads to previous resistance, and as the chart shows, this resistance was at the $ 800 level.

The previous rally was then canceled to gain support from this correction, which led to the Bitcoin price continuing to rally to record highs.

Since markets often behave the same way every cycle, a similar correction of 30% will push the bitcoin price up to $ 14,000. In addition, it was last June 2019 at $ 14,000, making it a potential target for a potential reversal of support / resistance.

Such a 30% correction will not harm the market, and this is very common. It can also give your survivors opportunities to start up.

Levels for display on lower time frames

BTC / USD hourly chart. Source: TradingView
Lower time frames indicate a possible reversal. Range is limited, with support in the green zone to $ 18,500. This level should have support for maintaining a bullish pace.

If he cannot maintain the support, he will most likely test the $ 16,000 range again. However, if the market is to maintain its bullish momentum, it must break the upper resistance of $ 19,500 to justify further continuation. However, this is where the classic bearish reversal of support / resistance occurs.

$ 19,400 was resistance, followed by a false breakout. Often, this failed outbreak is confirmed by converting the previous resistance to resistance as shown in the diagram.

Therefore, for a more bullish momentum, the US dollar must continue to show weakness, and the bitcoin price must exceed $ 19,500. If not, reconsideration will cost $ 18,500 and possibly $ 16,000 at the table.

Source: CoinTelegraph

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