The new week was quite bearish for bitcoin with the price witnessing major crashes below multiple support levels. After losing its position above $71,000, it has fallen further below $67,000, signaling the start of a downtrend. Amid the uncertainty, a crypto analyst has presented the important levels to watch as Bitcoin falls, indicating a possible direction for the price.
Bitcoin Enters Sideways Consolidation
In an analysis on the TradingView platform, crypto analyst Bitcoin Signals revealed some important developments for the Bitcoin price. The first observation is the fact that the coin has entered a consolidation zone on the 4-hour chart. This consolidation is currently taking place between $67,000 and $72,000, an area that the price is currently moving around.
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As a result of this development, the crypto analyst believes that a short-term correction is emerging for the cryptocurrency. This is behind the price drop, and since then, the BTC price has fallen below key support levels such as $69,200, and on Tuesday morning, bears were able to pull the price below $67,000 after breaking below the $67,200 support zone identified by Bitcoin signals in the analysis.
The crypto analyst further pointed out that the price could continue to move within this range, where the correction is forming. However, there is a falling wedge pattern that has formed due to the collapse. According to the analyst, this could cause the Bitcoin price to once again break out of the USD 69,200 resistance and rise towards USD 72,000 again.
Based on the analysis, the crypto analyst believes that the price could continue to correct downwards unless it can break the USD 72,000 resistance. Bitcoin Signals based this on the “current market structure and price behavior after a clear break on the long-term chart,” indicating a continuation of the decline.
BTC price on the charts
Selling pressure is currently dominating the Bitcoin price, as evidenced by the cryptocurrency’s direction, while seeing an increase in key metrics. For example, CoinMarketCap data shows that BTC’s daily trading volume increased by 89.85% over the past day. However, with the price falling, it suggests that this increase in volume is being driven by sellers and not buyers.
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In the past 24 hours, Bitcoin price has seen a price drop of almost 4%, reaching $66,700. This has erased most of last week’s gains as the weekly chart shows a 3% decline. Inflation fell to its lowest level in June, on par with the May 2024 crash.
Featured image created with Dall.E, chart from Tradingview.com