Following last Friday's drop, bitcoin has discovered itself coiled, once more, in the base of the range it established in December. With the current economy not able to shut a new high, the market finds itself in a precarious place:
Figure 1: BTC-USD, Daily Candles, Range Support Test
The blue service level shown above illustrates the boundary of the multi-week range bitcoin was bound by. In the time of this report, the sector is analyzing the support amount but has yet to close and continue below. We did see a temporary closure below the service level, but there was a really short-term rally on low quantity shortly after popping up the brand new low.
Figure 2: BTC-USD, Daily Candles, Maximum Support Amount
Just under our instant support level is present a secondary service level (displayed in red) established by a market pivot a couple weeks ago. It is not completely surprising that the drop inspired some keen bulls. It's still too early to say but the temporary support level doesn't appear to be inspiring substantially need. The purchase price spread is low, the quantity is reduced, and the rebound was immediately stifled on modest volume. As mentioned in our preceding investigation , this is sort of a no-man's-property due to the industry indecision within this range.
Figure 3: BTC-USD, Daily Candles, Upper and Lower Bound of Current Range
The figure above demonstrates that the perming resistance (displayed in blue and red) that refused the bullish attempts to split out. We can certainly see the daily candles at the top of the range closed lower and reduced, ultimately being rejected with higher volume and higher price spread.
Similarly, the marketplace has seen reduced and lower closes in the base of the range with lesser reactionary quantity along with tighter spread. This sort of market behavior is indicative of large provide presence together with comparatively weak and waning requirement.
Presently, we must determine whether the market closes and breaks below the current low. If we manage to close below the present level, we can expect to observe a test of the next service level in the low $3,000s. However, if we manage to exhaust the sparks at this level, we can fully expect to observe a test of the upper boundary of the range once more.
We are firmly bound in this price range, and a breakout of this range in either way will probably yield a strong continuation at the direction of the breakout. As always, we have to wait to see where the daily candle closes, however for the time being, the current market seems to be leaning toward a test of the decrease service.
We closed a reduced low on the daily candles but have yet to break through support.
The now cost level is bordering on the no-man's-property of the no-trade zone within the scope. If we manage to close below the present support amount, we can expect to observe a test of the non $3,000s. Otherwise, we can Probably expect to reevaluate the upper boundary of this range at the low $4,000s.
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