Bitcoin price analysis is finally leaning towards a recovery mode where the bulls can breathe. The major cryptocurrency has retraced the key $21,000 level and is trading at $21,600 at the time of writing. The bulls will certainly be relieved as it starts to move towards the key resistance level of $22,000 which may face a partial sell-off.
The $21,000 level is also psychologically important as it is the 2017 high and has supported the pair in the current freefall for a fairly long time. The rise in short-term support is sure to inspire some buying activity over the weekend as traders prepare for the week ahead. From here on out, volume will play an important role in how Bitcoin takes key resistance levels next.
Bitcoin price action in the last 24 hours: Investors looking for lower levels
Bitcoin needs to show that there are new lows next week to restore investor confidence. Bitcoin price analysis shows that the daily trend line is still down, but the current price action at $21,000 defends this key level. Previously, price action has rejected the move above the trend line in repeated bearish legs.
The price has broken above the hourly trend line but is still well below the long-term descending channel that is declining. The upper border of the falling triangle pattern is still intact. Bitcoin price analysis shows that the price cannot follow a short-term bullish trend.
In addition, the 50-day moving average along with the trend line above the descending channel are important obstacles for the current recovery. Bulls need to defend the 2017 record highs to rally beyond the current price decline.
Bitcoin/USD 4-hour chart: The upper triangle is a bullish barrier
Studies in Bitcoin price analysis show that the blue channel in the upper triangle holds the key to the current upward trajectory. Confirmation of a break above this descending channel ensures that the bulls can easily push the price to $24,000 next weekend. According to Bitcoin Price Analysis, such a move coupled with high volume only paves the way for a strong recovery towards the $26,000 resistance area.
The RSI is slowly climbing towards the 55 range, where buyers are becoming more active as valuations become attractive. The reversal pattern is also confirmed on the MACD on the hourly charts with further realization of the crossover. According to Bitcoin price analysis, if the bulls go on a buying frenzy, the price could move towards $28,000 in the short term if it breaks above the triangle. Many short positions will be liquidated daily and there is a possibility of a short contraction.
Bitcoin Price Analysis Conclusion: Bull Trap or Real Bull?
Volume data next week will determine if this is a real bull or just a bull trap. Also, how the price moves beyond the critical descending triangle will determine whether the bulls will reach $20,000 in the long term and sustain the price above $24,000 in the coming weeks. Bitcoin price analysis shows that if the price drops below $18,000 again, traders should prepare for a specific exit strategy.
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