- Bitcoin’s recovery hits a massive barrier at the 100 SMA and the descending channel’s middle boundary.
- BTC/USD likely to embrace consolidation based on on-chain metrics.
Bitcoin has struggled to recover from the mid-week retracement that saw it refresh lower levels under $18,000. Support established at the 200 Simple Moving Average on the 4-hour chart saved the bulls from a breakdown that would have been paralyzing.
The flagship cryptocurrency has already recovered some of the lost ground above $18,000. Meanwhile, the descending parallel channel discussed on Wednesday is still intact. BTC/USD is trading at $18,450 at the time of writing while fighting an uphill battle to overcome the immense seller congestion at the 100 SMA in conjunction with the channel’s middle boundary.
A big chance exists for Bitcoin to retreat further, perhaps confirm support at $18,000 before a significant recovery comes into play. Trading around $18,000 will allow more investors to join the market from the sidelines in anticipation of another rally.
If the demand for BTC balloons, the price could enter into an impressive trajectory, probably mimicking the majestic upswing in late November that led to the new all-time high ($19,927 as seen on Coinbase).
BTC/USD 4-hour chart
On the other hand, on-chain data from IntoTheBlock, using the IOMAP model reveals that Bitcoin is dancing between areas of intense support and resistance. This means that a consolidation period may come into the picture before any significant price movements occur.
For now, BTC’s upside is hampered by the seller congestion between $18,616 and $$18,789. A break above this resistance will see Bitcoin run into another massive hurdle running from $18,963 to $19,137.
On the flip side, Bitcoin is sitting on robust support areas, running from $17,901 to $18,442 and $17,360 and $17, 901. It is doubtful that Bitcoin will slice through these zones hence the possibility of consolidation taking over in the near term.
Bitcoin IOMAP model
Bitcoin intraday levels
Spot rate: $18,450
Relative change: -86
Percentage change: -0.5