Bitcoin fell 5% last night. This is the biggest one-day drop since November 2022. After a fruitful January (+39%), Bitcoin was waiting to make such a correction. Can we already say that the price will not fall anymore? Or is there another drop on the agenda? Let’s look at the prices.
Where was the resistance?
First, let’s take a look at Bitcoin’s monthly chart. The increase in the month of January can best be seen here. In addition to the main support and resistance levels (blue zones), we also see the monthly close of the July 2022 candle (+- USD 23,300). This level created the resistance that Bitcoin just repelled. We’ve already talked about it in previous reviews.
On the monthly chart, the price only seems to find support in the middle blue zone. This roughly translates to a price of $18,500 and would drop another 15%. However, it is good to zoom in because while the monthly chart gives the most important information, a short-term chart also shows us the minor supports.
In the short term two important levels
To analyze this, let’s take a look at the daily chart. In addition to the middle blue zone and the July 2022 resistance, we see a small support zone here. This is where the bitcoin price rises. This zone can be a good place to jump as the overall price does not make a lower low. This keeps Bitcoin in an upward trend that the coin has been in for the past few weeks.
Still, we can’t breathe a sigh of relief until a weekly or monthly candle closes above 23,300. Things could get worse if bitcoin drops below the bottom line ($20,400). Until then, we expect Bitcoin to move between the two orange lines, as the lower orange line is the previous low.
University degree
If bitcoin falls below it, the price will likely continue to drop in the lower blue zone. It would hurt a lot of bitcoin investors if that surge slows down in January.
It’s not there yet, but it’s important to keep an eye on this price and the daily close of the candle. If the price closes below it, a bearish scenario will emerge.
This also works on the bright side, but with weekly or monthly candles. If they close above $23,300, we could see another rally in the upper blue zone. That’s 32% above the current price of about $29,000.
Source: Btc Direct
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Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
