Bitcoin Faces 14% Rebound After 4-Month Low, Bearish Pressure Looms
1min read Bitcoin has recently experienced significant price fluctuations, causing concern among investors. Some analysts predict that the cryptocurrency could drop as low as $65,000 due to the challenging market conditions. Despite a notable rebound of 14% after hitting a four-month low, Bitcoin remains significantly down from its all-time high, indicating potential ongoing volatility.
According to analysis from GDXTrader, a “dark cloud cover” pattern has emerged, suggesting renewed bearish pressure for Bitcoin. This pattern typically signals a potential top-out in price movements, as seen with a recent rejection at the $87,470 resistance level. The dark cloud cover pattern forms after a period of upward momentum and indicates a shift towards a bearish trend. Detailed analysis of the BTC/USD daily price chart reinforces this bearish sentiment, as buyers' attempts to push prices higher were met with increasing selling pressure. Unless Bitcoin decisively breaks through the $90,000 to $93,000 resistance zone, it is likely to remain under bearish influence.
Bitcoin’s price actions have broader implications, particularly with the concept of a “perfect rejection” noted by trader CrediBULL Crypto. This phenomenon occurred as Bitcoin attempted to break through the $86,000 to $88,000 resistance zone but failed. Such rejections often increase the likelihood of a downward movement in the cryptocurrency. Currently, Bitcoin appears positioned towards key support levels approximately between $77,000 and $79,000. A drop below these thresholds could lead to more significant declines, potentially reaching the pivotal $65,000 to $74,000 liquidity area by April, as indicated by the trading analysis.
Ask Aime: What's behind Bitcoin's price drop?
Market analysts are also observing Bitcoin’s correlation with traditional equity markets. There is a strong relationship between Bitcoin and major indices like the S&P 500 and Nasdaq 100, both currently exhibiting bear flag patterns. This correlation suggests that Bitcoin’s performance is increasingly influenced by macroeconomic factors and broader market trends. As trade tensions and market volatility continue to unfold, Bitcoin may experience additional pressure. The potential risks posed by external economic factors, including a looming US recession, could adversely affect the crypto landscape.
In summary, Bitcoin’s struggle to maintain upward momentum amidst bearish market signals provides a complex landscape for traders and investors. As analysts closely monitor key resistance and support levels, the potential for declines to $65,000 remains a possibility if current patterns persist. Observers are encouraged to consider the broader economic influences shaping Bitcoin’s trajectory to better navigate this evolving market.
