Last night, bitcoin price dropped 5% in one hour. A very painful step for investors. However, there is no reason to expect more red candles just yet. Bitcoin is currently receiving support from an important trendline. However, this is the last support before the price can fall freely…
Today we will first discuss the trendline. We also discuss which other supports are important in case the price falls further. Finally, let’s take the S&P 500 chart and try to get a better idea of Bitcoin’s future movements.
The important helpline
As can be seen in the chart below, the bitcoin price is currently back on the trendline. The important question is whether this support is strong enough to prevent further declines. However, there is reason to believe that the support is strong as the price has held this line twice before.
What matters is how the daily candle closes today. If the price remains above the line, there is still reason to expect an increase. Price levels such as $25,000 can be retested. While there is still a long way to go, it could be as high as $28,800. However, this can only happen if the giant $25,000 resistance is broken. This will certainly not be an easy task.
Watch out if bitcoin price closes the daily candle below the trendline. For example, a level to watch for support is $21,380. If the price continues to fall, it will look for higher support levels. An example of a very large support is $19,500.
Is there a reason for the bear market?
In my opinion, this question cannot be answered just by looking at the price of Bitcoin. Correlations often play an important role. Today I will give an example of correlation. As I mentioned earlier in my review, there is a correlation between the US top 500 stock index (S&P 500) and Bitcoin. Often the largest cryptocurrency follows the trend of that index.
Above is the stock index chart. It can be clearly seen that after a long pause below a very important resistance level, the price broke above the line and then tested it as support. This is a positive sign that there is bullish momentum in the market.
University degree
While I was surprised by Bitcoin’s recent dip, the chart shows that the largest cryptocurrency is still trading above a key support line. In addition, the S&P 500 chart looks very positive right now as it successfully tests broken resistance as support. In short, I see no reason to be pessimistic on this point.
Source: Btc Direct
Source link
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.
