As Bitcoin (BTC) experiences stagnation in its current price, technical analysis suggests that the maiden cryptocurrency is now at a critical point with the potential for significant movements.
Analysis shared by investment research platform Game of Trade in an X post on June 29 pointed out that Bitcoin could experience significant market movements depending on its ability to navigate its current technical setup.
Notably, the analysis indicated that the rising channel, a crucial feature, has been in play since early 2023. This channel has acted as both support and resistance, guiding the overall uptrend.
Recently, Bitcoin’s price fell back into the rising channel after spending four months above it. This move is critical as it suggests a potential breakdown, further downside risk, or a false breakdown if the price reclaims the channel’s upper boundary.
“Bitcoin is at a very critical level now; It has broken back into the rising channel after spending 4 months above it. If this move confirms, then further downside is at risk. But if price is able to reclaim the channel resistance, then this would be a false breakdown,” the platform noted.
Levels to monitor
Additionally, the MACD (Moving Average Convergence Divergence) indicator shows bearish momentum. The MACD line is below the signal line, and both are in negative territory, indicating that the bearish trend could continue if no significant reversal occurs.
The analysis further noted that the current level of around $60,800 is crucial. Should Bitcoin fail to regain the upper channel line, investors might see a continuation of the bearish trend with potential support levels around $52,000 and $44,000. Conversely, reclaiming the channel could signal a recovery and continuation of the bullish trend, targeting new highs.
Therefore, the next few days or weeks are critical. Confirmation of the breakdown could trigger further selling, while a false breakdown might offer a buying opportunity.
As things stand, Bitcoin is seeking to avoid dropping below the $60,000 support as the cryptocurrency continues to show consolidation. Overall, Bitcoin and the broader cryptocurrency market are exhibiting a mix of uncertainty and volatility influenced by several factors, such as the US presidential election debate between Donald Trump and Joe Biden.
Additionally, Bitcoin has largely remained flat, failing to match the stock market at a time when new personal consumption expenditures (PCE) price index data suggested that inflation is cooling.
Bitcoin price analysis
Meanwhile, Bitcoin has dropped below the $61,000 support, changing hands at $60,900 by press time. Although BTC has made modest gains of 0.3% in the last 24 hours, it remains over 5% down on the seven-day time frame.
In summary, Bitcoin is facing a test as bears and bulls tussle. If bulls pull the asset above $61,000, investors will be hopeful. On the other hand, dropping below $60,500 could signal more sell-offs.
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