Bitcoin Rejects Downside At $29k, Here’s Why This Is Good


Today’s Bitcoin price analysis is positive, as the drop to $29,000 was met with strong support and rejected, indicating that an additional downward trend is unlikely. As a result, BTC/USD is expected to rise further in the coming days, most likely above the $31,000 resistance level.

Of course, the psychological price of $30,000 for Bitcoin means a strong buying zone. We’ll look at why Bitcoin’s recent consolidation around $30,000 is a promising sign of price increases in the future.

Bitcoin drops 57% from ATH

Bitcoin price has fallen from a high of $69,600 to the current level of $29,350. The entire cryptocurrency market was devastated by a 57 percent price drop. As a result of the price drop, a snowball effect is starting to occur, causing other crypto projects to be hit and sink even further.

The $30,000 price range for Bitcoin is critical. Many large companies have bought bitcoins at this price. Moreover, as shown in Figure 2, Bitcoin prices have historically consolidated around those specific positions prior to the start of the advance.

Bitcoin

BTC/USD 1-day chart showing the consolidation area. Source: TradingView

For more than a week, Bitcoin has been trading sideways, with the $31,000 mark as strong resistance. Meanwhile, a significant support was established at $29,000, indicating a clear consolidation area that must be overcome before the market can continue developing.

The previous high was set at the same level as the previous low, which indicates market indecision. As a result, the recent test of $29,000 may lead to a retest of resistance again.

Related reading | Eight consecutive red closes: Is Bitcoin headed for a recovery?

Will unification happen?

If BTC price drops below $28,000 again, the next support area will be around $20,000. However, prices are likely to rise from the stage of Bitcoin price consolidation. The first target is about $35,000, or a 17% price increase. Next, prices should target the next psychological price of $40,000. From there, we may see a slight downward adjustment, but in the longer term, prices should break higher. This would mark the official start of an uptrend.

For the price of bitcoin to establish a foothold in the short-term, according to Josh Olszewicz, head of research at Valkyrie Investment Management, volatility must be reduced.

“We can look at things like the 200-week moving average, which is about $22,000. We can look at the realized price, which is the average price of coins that have moved on the chain, which is around $22,000,” Olszewicz said on CoinDesk TV’s “First Mover” show. It is about 23,800 dollars.” This [movement to hit bottom] It’ll probably take at least the entire third quarter, and maybe the fourth quarter as well, if it’s going to happen this year.”

Other variables, such as the US Federal Reserve raising interest rates, also affect the performance of the bitcoin market, according to Olszewicz.

He speculated that institutional investors may be at the forefront of the downturn. The average transaction volume across the chain, according to Olszewicz, is tens of thousands of BTC.

However, according to Olszewicz, regular traders continue to influence market movement more than institutional investors. Those who are learning about cryptocurrencies are now jumping through this bear market to “test the waters” and “see if they can survive,” according to him.

Suggest reading | Ripple (XRP) drops to $0.43 and bears are in full swing

Featured image from iStock photo, chart from TradingView.com



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