BTC price remains stuck between two crucial levels with no sign of directional bias. However, weak trade movement could bring the cryptocurrency level and price down.
That’s the opinion of analyst Akash Girimath. According to him, the immediate support area that prevented a sharp correction appears to be getting weaker with each retest, indicating that an advance to the downside is likely.
“BTC price is consolidating between approximately $45,000 and $35,000 and has been doing so for the past two months. The fall in late January encountered similarly strong buying pressure, leading to a close above the $34,752 support level,” he said.
According to the analyst, this level was crucial to avoid a sharp correction to the downside and as BTC recovered from this crash, it set up a demand zone, ranging from $36,398 to $38,895.
“In the better half of this phase, BTC has respected this barrier and seen impressive momentum moves from this area,” he said.
However, he pointed out that as BTC price marks this barrier for the third time, the allure and strength of said barrier appears to be on the wane. Thus, the current retest can break this barrier and make way for the $34,752 support level.
“A daily close below this base will be critical in triggering a drop to the psychological barrier of $30,000. If this scenario occurs, BTC will likely extend lower and collect stop-sell liquidity below the $29,100 support level.”
On the other hand, from a conservative perspective, the drop to $29,100 could serve as a capitulation move, marking a possible bottom.
But, a breakout of the aforementioned level will push BTC to $23,000, which could be the second potential bottom.
“There is no doubt that we are in a bear market due to the duration of the sell-off. There has never been a bottom of a bear market in BTC without a capitulation event. So I think there is a high probability that this region will collapse, and we test lower lows before the buildup occurs to set up the next bullish cycle.”