- Bitcoin closes the week under $40,000, opening the Pandora box for a possible slide to $32,500.
- Closing the day above the ascending channel’s upper boundary may invalidate the breakdown but favor a recovery above $40,000.
Bitcoin almost brushed shoulders with $42,500 last week but stalled, allowing for a retreat under $40,000. However, Bitcoin managed to hold within the ascending parallel channel aided by the 50 Simple Moving Average on the 4-hour chart.
Robust support appears to have been established at $35,000 but at the time of writing, BTC is holding above the channel’s lower boundary. Meanwhile, it is very uncertain the direction Bitcoin is going to take from now.
Note that, holding above the channel’s lower boundary support is a bullish signal. Thus buyers are likely to join the market from the sidelines, in anticipation of recovery above $40,000. Price action beyond this key level may call for more buy orders, increasing the bulls’ confidence in BTC making it past $42,500 and trading another new all-time high.
BTC/USD 4-hour chart
On the other hand, closing the day under the ascending channel’s lower boundary support may invalidate the above uptrend in favor of losses under the 50 SMA. If the buyer congestion at $35,000 is overwhelmed by selling pressure, Bitcoin is likely to explore lower price levels, perhaps at $32,500 and the 100 SMA respectively.
For now, the least resistance path seems to be downwards, especially with the Relative Strength Index moving towards the oversold area. In other words, if bulls are not careful, Bitcoin may completely fall into the hands of the bears and the journey to $32,500 could be a short one.
Bitcoin intraday levels
Spot rate: $37,100
Relative change: -1050
Percentage change: -3