Bitcoin Consolidates Near $20,000; Is A Sign Of Reversal?

Bitcoin price was struggling near $20,000 and extended the consolidation for the second consecutive day. The heavy sell off on Tuesday left investors in the vary as they are looking for a confirmation to place the fresh trading bets. The price hovers in a narrow trading range with no clear directional bias. But the sentiment skewed in favor of bears.

• Bitcoin price continues to trade lower following the fall on Tuesday—a deprecation of 10%.
• The price struggles below the important moving average crossover, indicating selling pressure.
• The Fear $ Greed Index increased one point from yesterday at 28, an improved sentiment.

Bitcoin price consolidates

The short-term momentum oscillators indicate that the sellers are in control of the price and wanted to swing yesterday’s lows amid low trading volumes.

Bitcoin buyers seemed to have found reliable support around $20,000, as it serves as a short-term demand zone. This can be stated as we can see the formation of two consecutive Doji candlesticks, suggesting a tug of war between bulls & bears.

After falling 26% from the swing highs of $25,212.0, the price made a swift recovery and tag the $22,000 mark. But the upside faces a challenge near the bearish descending trend line that extends from the mentioned high level. Further BTC sliced below the 21-day and 50-day ema, adding to the bearish sentiment.

Despite the weakness, the Bitcoin bulls managed to defend the key $20,000 level and now extending the consolidation. A discount buying opportunity could motivate sideline investors to make an entry here. If that occurs, an immediate upside target could be identified at the 21-day ema at $20,697.66.

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Next, the market participants would take a leap and try to meet the bearish trend line at $21,700 followed by the high of August 19 at $23,202.00.

The RSI (14) is giving a  neutral sign as it hovers near the average line. Currently, it reads at 46.

In contrast, a failure to hold the session low would neglect any bullish argument. On moving lower, the sellers would liquidate toward the low of September 9 at $19,303.03.

As of publication time the Bitcoin is trading at $20,155, down 0.41% for the day. The 24-hour trading volume declined more than 14% to $40,575,298,015 according to Coinmarketcap data.