Analysis: Here’s what Bitcoin needs to do to avoid falling to $18,500

Another week has arrived, so it’s time to look back at the Bitcoin charts. Although the week started quite positively, the currency weakened slightly over the weekend. As a result, bitcoin unfortunately closed just below a significant resistance.

monthly candles

To demonstrate this, let’s take a look at the monthly chart. Each candle in the image below represents 1 month. Here we see three levels to which Bitcoin has historically responded. These can be seen as blue zones. We also see an orange line (the current resistance) dating from June 2022.

This month Bitcoin made a green candle and the spot where it closed is now seen as resistance. As shown above, the monthly candles for January and February do not rise above the orange line. It can become problematic if the price does not rise above this. In this case, there are many sellers in this resistance.

Fortunately, the month is only 6 days old and Bitcoin can still close a candle above this level, but it would have been better if January had already been above it. Of course we couldn’t ask for more from this month, because it’s already been a bizarre 31 days, almost 40%.

Back below the orange line

To further analyze the price of Bitcoin in the short term, we also look at the daily chart. Here we can better see that the coin broke just above the resistance. But yesterday it recovered below that line.

This is usually not a good sign as the price had to support an orange line here. Since the coin is not finding enough buyers around $23,000, we will probably move lower for a while. The next support will likely be the target.

The blue zone is the largest on the map. That’s about $18,500 and should therefore not be broken under any circumstances or we could soon see prices of $12,000. But there is already a place that can provide support: $21,000.

This has to do with the little “downtime” Bitcoin had on its way to the orange line. At that point, the price encountered slight resistance, resulting in those pair of red candles. This implies that a new “price war” may be emerging at this time. Until bitcoin regains the orange zone — or finds no support — we will likely see a price between $21,000 and $23,000.

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