Bitcoin Price Analysis: BTC Drops 13% To Retest the $58,000 Support Floor

Bitcoin price retests the $58,000 support level as it struggles to reclaim the $60,000 crucial support wall. BTC has lost almost $10,000 from its all-time high above $69,000. Overcoming the 200 SMA above $62,000 could see Bitcoin restart the upswing.

Bitcoin price extends Tuesday’s price correction as it retests crucial support levels. Bitcoin has dropped as low as $58,527 on Wednesday as the $58,000 support level comes it handy. Analysts are, however, remain bullish on Bitcoin that it will resume the upswing as long as it recaptures the $60,000 psychological level.

Bitcoin  Price Grapples With the $58,000 Psychological Level

The current BTC price drop has seen the big crypto decline 14% from the November 10 all-time high (ATH) above $69,000 to the current price around $59,572. The drop has seen Bitcoin slice through the $60,000 psychological level repeatedly shedding more than $10,000 from the ATH as seen on the four-hour chart.

The four-hour demand zone between the $58,527 and $60,876 levels offer crucial support areas that decide the direction taken by Bitcoin price.

A bounce from this support zone could bolster the bulls who are likely to push the Bitcoin price above the $60,876 major resistance level to tag the 200-period simple moving average (SMA) at $62,683. Flipping this level into support is likely to propel the bellwether cryptocurrency towards new record highs above $70,000.

BTC/USD Four-Hour Chart

Before this, BTC/USD has to overcome the 100 SMA at $63,571 and 50 SMA at $64,304 embraced by the declining trendline.

The above bullish narrative thesis that BTC price will bounce hold the $58, 000 support zone, however, a breakdown of this support floor will suggest that Bitcoin could head into a liquidity area, ranging from $53,000 to $56,000 psychological levels.

The position of the Bitcoin price below the SMAs and the entry of the Relative Strength Index (RSI) into the oversold region validate this negative outlook.

The position of the Moving Average Convergence Divergence (MACD) indicator below the neutral line adds more credence to Bitcoin’s bearish narrative.