Bitcoin Bounces Off Consolidation Range, What Lies In Store?


Bitcoin has been on a steady increase for the past two weeks. It hasn’t been in an uptrend all this time, but most of the time, the digital asset has maintained that bullish trajectory. This led to it touching above $24,000 sometime after bouncing off the strong consolidation point. Now, with the digital asset approaching $23,000, two technical levels are beginning to form beneath it.

Bitcoin starts forming support

Bitcoin broke above $23,000 again, and support is starting to form. After the digital asset lost ground earlier and fell to $21,000, the support dropped to $19,000, but that will change shortly. As Bitcoin continues its bullish trend, it is now looking to support at $21,000, which is much stronger than what was identified earlier.

Related reading | Bullish sentiment extends to institutional investors as Ethereum balloons flow

However, for digital assets to continue this bullish run, they will need to break some important technical levels. The first would be the $25,000 range, where the largest resistance is currently being installed. The broad build-up trend will be the only potential fuel for a breakout of this level. After that, the nearest resistance will be formed at $28,000 as it is the lowest point of the 2021 cycle.

Bitcoin price chart from TradingView.com

BTC continues recovery trend | Source: BTCUSD on TradingView.com

On the flip side of this, digital assets still have some potential to hold back. This would put it in the direct path of the $21,000 support, but this is unlikely to continue in the long term. The next major support level will drop to $19,700, which is the peak of the 2018 bullish cycle. Hence, the support provided here will be consolidating compared to the $19,000 support. But if this fails to hold, then $17,600 will be offered as the next level of interest as it is low in the current cycle.

Related reading | Ripple (XRP) is up 190% from the low cycle, but will it reach $3?

At the moment, with Bitcoin on the rise, it is still expected to encounter resistance at $24,000, the point it failed to overcome last week. This makes it the most immediate threat to the bulls in their quest to win back $30,000. This point determines whether Bitcoin is able to break above the 50-day moving average, which will determine a downward or upward trend in the short term.

However, selling remains the main thing that drags down the value of bitcoin. While the short term is beginning to shift in favor of buying, the longer term outlook is still a sell off for investors. These sell-offs, which have not yet reached the point of fatigue, are most likely the reason why Bitcoin was unable to successfully break through $24,000.

Featured image from The Financial Express, chart from TradingView.com

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1 thought on “Bitcoin Bounces Off Consolidation Range, What Lies In Store?”

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