Bitcoin’s Horizontal Levels Show Potential For Bullish Trend
After regaining its bullish momentum, the market’s biggest cryptocurrency Bitcoin (BTC) briefly broke above its key resistance level of $28,700. However, the cryptocurrency pulled back and traded back within its range formed last week between $27,600 and $28,500.
Despite this choppy price action, a recent blog publish by Justin Bennett, crypto trader and analyst suggests that BTC has established “strong” horizontal levels, which are favorable for both scalpers and investors who prefer this period of range or consolidation in the market.
Will these horizontal levels maintain a potential decline in BTC price?
Bennett further mentions that Bitcoin trades above the $28,130 pivot point on an hourly and 4-hour closing basis. Any attempt to retest this level is likely to attract sellers, potentially triggering another run on the $27,650 support floor and potentially lower prices.
While the horizontal levels seen on the chart could provide opportunities for scalping, Bennett cautions that there is potential downside risk if BTC support levels are breached.
Bennett suggests that while BTC price has no confirmed direction, there are currently more long liquidations below the price than short liquidations above it. This means that a greater number of traders have taken long positions and could be at risk of liquidation if the price drops further over the weekend.
However, with Bitcoin trading above the major pivot point, there is still potential for further gains and consolidation above the $29,000 level. The $28,900 macro resistance level is the next target for BTC, and a successful breach could lead to further gains for the market’s largest cryptocurrency.
Bennett further suggests that Bitcoin’s main range is between the $26,500 support and the $28,900 resistance wall, with smaller breaks within that range. This can result in the price movement being relatively stable within that range. Still, there is potential for significant volatility if the price breaks out of this range and corrects towards the support level.
A new cycle is just beginning for Bitcoin
According to Rekt Capital, with the close of Q1 for Bitcoin and the broader cryptocurrency market, BTC is on the verge of confirming its first quarterly bullish candle since early 2020. This pattern occurs when the opening price of a given quarter is lower than the closing price of the previous quarter.
According to for Rekt, this pattern has historically preceded several bull quarters for Bitcoin, meaning that the price of BTC tends to rise for several quarters after the pattern is confirmed, such as in the 2021 bull market.
Even if the price of Bitcoin takes a short-term pullback, cryptocurrency market sentiment seems to point to one thing: BTC is ready for another bull run.
The market is expected to experience a sustained period of price increases in the coming months, with the first quarter closing above key levels. This suggests strong potential for growth and investor confidence despite short-term fluctuations in Bitcoin price action.
Featured image from Unsplash, chart from TradingView.com