Bitcoin has been holding up well all weekend in the narrow sideways range of 47,124.39 - 48,178.13 between the blue and red dotted lines. But Monday brought a new surprise: the price of BTC/USD came out of the consolidation zone downwards, rapidly approaching the strong mirror support level of 41,980.24.
At the time of writing, the price is hovering slightly above $43,400 per coin, with a daily loss of 7.98%.
The fall of bitcoin led to huge liquidations of $312 million - margin calls triggered. The average entry is about $45,000, which means that a drop below this mark can lead to the beginning of a serious correction in the market.
Meanwhile, various network data providers have noticed multiple spikes in supply on the exchanges, which is considered a negative sign. The money that appears on the stock exchange is usually sold in the market at some point.
At the same time, the average long/short ratio remains at 98% for long positions, which suggests a serious overheating of the market.
Nevertheless, network analysts point out that although the market is currently showing no signs of potential progressive growth, the data on the network still indicates that the bull market continues, and the bears are still not in control of the situation. Network indicators, such as stock inflows, show that there is no growing pressure from sellers in the market, and the current correction is of a short-term nature.
But let's look at it from the other side. Technical analysis allows you to assess the situation since the price includes everything. And now the daily candle is breaking through the local support level of 44,807.24, marked with a red dotted line. This means that the quotes are open to a path lower, to a strong mirror level of 41,980.24.
But the day is not over yet, which means we may well see a long lower shadow and a close above the red dotted support at 44,807.24. In this case, we can assume that the bulls retain the advantage.
If the price drops to the level of 41,980.24, it will become an alarming sign, since this is the last border separating the conditional "bullish" and "bearish" zones on the chart.
What does it mean? For speculative traders, this is the time to be wary of uncertainty. Will it be possible to buy if the price remains sideways between the support at 44,807.24 and the resistance zone at 47,124.39 - 48,178.13? In theory, yes, but the stop size will be very large in relation to the profit potential.
But if the level of 41,980.24 is confirmed as support, then a very good entry point can be formed here. But before that, false breakouts and even stop losses are not excluded, after which it will be possible to re-enter the long.
*La presente analisi del mercato ha un carattere esclusivamente informativo e non rappresenta una guida per l`effettuazione di una transazione.
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