As the price of Bitcoin falls below the 20-day moving average, bears regain strength, indicating that adverse trends may continue in January.
Bitcoin (BTC) has been hovering near $42,500 for some time as investors anxiously anticipate the introduction of the first spot Bitcoin ETF in the United States. A report from the previous week indicates that the U.S. SEC’s approval is expected to be received this week at the latest.
Will Bitcoin ETF Sale be News Worthy?
In 2023, following a substantial 160% increase the previous year, analysts anticipated a retracement in the price of Bitcoin shortly after the introduction of the Bitcoin ETF. BTC may likely undergo a sideways consolidation until April 2024, when the halving of Bitcoin is scheduled to occur.
Rekt Capital, a well-regarded investor and crypto analyst, analyzes the recent monthly close of Bitcoin, highlighting significant support levels and historical patterns.
Rekt Capital emphasizes in a recent update that Bitcoin has a track record of volatile retests during periods of hovering near the $41,000 support level (depicted in blue). Approximately $37,000 was traversed by downside wicks during these retests, indicating the presence of a discernible pattern in the price movement.
Rekt Capital hypothesizes that a prospective decline to the $37,000 level is a robust retracement grounded in historical data. The analyst highlights that Bitcoin has previously undergone comparable price fluctuations and that such trends have traditionally bolstered the overall market stability of the cryptocurrency.
#BTC— Rekt Capital (@rektcapital) January 1, 2024
New Monthly Close is in
The last two times Bitcoin retested ~$41000 (blue) as support, price produced volatile retests
The retests saw downside wicks go to as low as the ~$37000 region
History suggests any dip into ~$37000 would be healthy$BTC #Crypto #Bitcoin pic.twitter.com/AVBF7WYAYL
Furthermore, Rekt Capital emphasizes that with less than a century remaining until the Bitcoin Halving, investors may find the greatest value in purchasing at a discount during any further retracements in the pre-halving period.
Traders and investors are diligently observing these pivotal support levels and historical patterns to gain potential insights into the future price fluctuations of Bitcoin as the market continues to evolve.
Bears’ Grip Strengthens as The Rekt Capital BTC Upside Remains Capped
The January 12 Bitcoin options data has exhibited a decline in strength in recent times. In addition, analysts believe that the upside potential for Bitcoin is limited, even if it does surge in response to the ETF approval.
The present condition of the Bitcoin market is characterized by diminished highs and lows, which suggests that bears are gaining strength, as per a recent analysis. Significantly, the prior peak, which surpassed $44,800, has not experienced a retest, providing additional evidence for the adverse sentiment.
Upon achieving a multi-month high, Bitcoin’s price has recently declined below the daily EMA-20, which is $42,542. According to an analysis of the chart, this level has not been breached in the past couple of months. A two-day bearish volume apex, representing the highest levels observed since April, indicates that a correction may be imminent.