Technical analysis Bitcoin | Bitcoin must recover now

Bitcoin Technical Analysis: daily chart

These are exciting times for Bitcoin investors. After a summer dominated by falling prices, hodlers were finally rewarded again. Between May and July, the price landed just below $30,000 several times. Out of nowhere the price started to rise again and at the end of July it broke out of the resistance at around $41,000.

At the beginning of this month, Bitcoin’s price was again happily above $50,000. An attack on the all-time high seemed close again, but the fall of September 7 threw a spanner in the works. Last week, the price formed a temporary bottom and we saw some recovery. However, the price has again bounced off the resistance zone around $48,500 and in recent days has taken another hit.

The Chinese real estate giant Evergrande caused a lot of panic in the financial markets. Not only did the crypto markets plunge, but shares were also hit hard.

ABC correction?

It looks like we are dealing with a classic ABC correction. The rise from 30k to above 50k is followed by two declines. The first decline is A, the recovery that follows is known as B and the current second decline is known as C.

Interestingly, Bitcoin has re-entered the support zone around $40,000/$42,000. This level has formed resistance several times over the past year. Currently, the area is acting as support. In addition, the 200-day moving average (red line) is being tested today. At the beginning of a bull market we often see that the price tests back to the 200EMA. It is therefore important that the price remains above this level.

If the price drops below this level, the last support zone is the bottom at $37,300. This is the last safety net for Bitcoin, because if this support is broken then the price can go down again to $30,000 or lower.

Resistance at $48,834

The resistance is clearly at $48,834. This is the level that Bitcoin needs to break through before we can say with any certainty that the Bottom has been set. After a breakout we can expect rises towards the $52,810 and higher.

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By Yourcryptolibrary Editorial Board