Bitcoin moves in a range. The price was rejected at the previous high and is now moving towards the bottom. Will the same thing happen here and the course turns 180 degrees?
To start with: the range. This is a range the price of bitcoin moves between (the yellow zones in the chart below). Bitcoin has been in the same zone for a month between about 40,000 and 46,000 euros. Since the dip of exactly a month ago, not much exciting has happened with the course. The fear was there with every small drop, but we haven’t seen any major moves from the market leader since then.
Range
Bitcoin, as seen in the chart above, made a high that ushered in the range. This top was then put to the test twice. At these two highs (seen in the blue circle), bitcoin was rejected from moving further up. The result was a decline that continues to this day. Because bitcoin has not yet shown any sign of recovery and the price continues to fall, it may well be that the price will first seek the low of 40,000 euros.
It can happen that the price flips here, again towards the other top of the range. When that happens, many investors will be happy, because a further decline is excluded. The price would have to dive a little bit lower to confirm this support.
Zoom out
It is good to also zoom out, because with higher timeframes you see more. In the chart below, each candle is two days. Inside the blue circle is the graph above, but zoomed out.
When bitcoin will lose its lowest local point of 40,000 euros, the first support will be a very big one. This can be seen as the large yellow zone in the graph above. The price will not fall through this quickly, because this zone has been very important last year. As you can see, it has acted as support and resistance numerous times.
This zone starts at approximately 36,500 euros. We are talking about the worst case scenario here. To do this, you must first break the range at the bottom. Don’t worry while we’re still in that range; this is just a fantasy in case the worst happens.
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