Bitcoin Reclaims $20,000, Could It Lose Support Again?

Bitcoin and other major currencies have seen a steady free fall, even reaching multi-year lows. BTC touched the $17,000 mark this month, however, the king coin is now back at $20,000. Over the past week, the coin lost 22% of its value but is up on the daily chart by nearly 7%.

The technical outlook for the coin has picked up an uptrend but still shows signs of weakness. Buyers are also back in the market, but if buying power drops again, BTC may find support near $17,000. It is still difficult to determine whether the currency has fallen or not.

Several altcoins also jumped on the chart as Bitcoin showed signs of relief. This also included Ethereum which is up 9% in the past 24 hours. Today, the global cryptocurrency market capitalization has reached $950 billion, an increase of 6.1% Change in the last 24 hours.

Bitcoin Price Analysis: 1 Day Chart

Bitcoin trades at $2,020,020 on the 1-day chart | source: BTCUSD on TradingView

BTC touched an 18-month low as the coin dropped near the $18,000 mark yesterday. Pressure from sellers has constantly pushed the price lower. Despite the return to the $20,000 support level, the market is still being controlled by the sellers.

The upper call resistance is at $22,000 and a drop from $20,000 will bring BTC near $17,000 to $16,000. BTC trading volume is also down on the chart. The bar has turned red, which was an indication that Bitcoin is still in control of the bears.

Technical Analysis

Bitcoin is showing signs of a price reversal on the 4-hour chart | source: BTCUSD on TradingView

On the smaller time frame, Bitcoin is showing bullish signs. The RSI rose significantly and touched the 50 line, which means that buyers appeared in the market. But over the past 24 hours, there has been a drop in the RSI which again indicates a slight decrease in buying power.

With more buyers, the price moved above the 20-SMA line. This means that the buyers were driving the price momentum in the market. Increased selling pressure will soon bring the bitcoin price below the 20-SMA line, giving sellers the ability to drive price momentum.

According to the upward trend, the currency has formed a descending channel pattern (yellow). This pattern is a bullish reversal pattern that indicates the chance of BTC rising more on its chart. Buying power needs to increase for the price to hold above the $20,000 mark.

Related reading | Over $250M in Liquidations as Bitcoin Recovers Over $20,000

Bitcoin is blinking a buy signal on the 4-hour chart | source: BTCUSD on TradingView

The currency was bullish on its chart at the time of writing. The same great oscillator also reflects positive price action. AO determines price direction and reversals. The indicator displays green histograms which also correlate with a buy signal.

Directional movement indicator indicates directional price movement of a currency. +DI was above the DI line- this means the upside trend. The ADX (red) was in the fall and was approaching 40 marks, and a fall below 40 means that the current trend is losing steam and Bitcoin may fall again on the charts.

Related reading | Why Bitcoin Could Take Another High at $17,000

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