Since Bitcoin tested the upper boundary of its channel this month, the volatility dropped as it entered a consolidation phase. It is still trying to regain momentum on a daily but lacks enough volume to sustain the rally.
Bitcoin’s consolidation phase extended this week amid low volatility. The trend is still in favour of the bulls but it appears they may lose control very soon due to recent weakness in buying pressure.
Despite that, the leading cryptocurrency has managed to tap $38,414 despite facing multiple rejections since it tested the channel’s upper boundary earlier this month.
Looking at the price and volume disagreement, which suggests a potential shift in trend towards the downsides, BTC is likely to witness a bearish divergence (as a correction) any moment from now.
While anticipating, it has seen a 1.5% drop to the low of $36,707 today. The price recovered quickly and climbed back above the key $37,000 level.
A strong close below last week’s low would confirm the potential shift on the daily chart. If that happens, the channel’s lower boundary would be the area to watch for selling.
However, it is essential to note that the price is still respecting an ascending channel as shown on the daily chart. A surge above this channel will set a fresh bullish tone for Bitcoin in the mid-term.
Bitcoin’s Key Levels To Watch
In the case of breakdown, the channel’s lower boundary would be the main target in the near term. But before then, $36,729, $35,670 and $34,578 are the key support levels to first watch for a drawdown.
On the other hand, a push above the $38,000 resistance level could recover the price back to $38,414. A spike from there could allow the asset to test $39,000 and $40,000, above the channel.
Key Resistance Levels: $38,000, $38,414, $39,000
Key Support Levels: $36,729, $35,670, $34,578
- Spot Price: $37,100
- Trend: Neutral-Bullish
- Volatility: Low
Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services.
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