Over the past week, Bitcoin bulls seemed to have taken control of the price, eventually pushing it back above $73,000. There has been a slowdown since then, with bears attempting to retest the $70,000 level this weekend. For now, the bulls are still open, but there is still the possibility that the price will crash again. To this end, Bitcoin price has an important support level if the bulls actually want to continue the uptrend.
The magic point for Bitcoin is at $70,500
After the initial rejection of the highs in the range, Bitcoin price is now moving towards a crucial level. According to crypto analyst Maximum transactionsit is now moving towards the next major support level that bulls need to maintain. This level is just at $70,500, being the major support since the start of the uptrend.
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It is important to hold this key support level as it will determine whether the uptrend will continue. The range high is currently still above $72,000, so that is where the bears are offering the most resistance. So the price will have to break the high level to continue rising, or break the key support to resume the downtrend.
Another major thing dragging the price down is the fact that there is still a CME gap that has not been filled yet. This CME gap is below $67,000, making it a magnet for the bears. Given this, if Bitcoin price were to eventually break the key support at $70,500, it would begin to weaken the bullish structure that started to manifest last week.
A move towards the CME gap would mean a break below $67,000, moving towards $66,000 to make a bottom. But even this would not determine this to be the bottom of the downtrend, as there is the possibility of a further decline to gain more liquidity.
Key liquidity levels are below $65,000, which is where the whales could head to make the most of this move. This means that if the main support is broken, it would only be the beginning of the trend. The final move would be a cascading event that could send it even lower.
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However, the crypto analyst does explain that the Bitcoin price is not bearish at the moment. This is because the price remains within the range, and trading above the key support level keeps it stuck here. “An important point to keep in mind is that BTC is still range-bound, and as long as that remains the case, the price will be primarily liquidity-driven and chasing both ways.”
Featured image of Dall.E, chart from TradingView.com