Bitcoin appears to be on the verge of breakdowns after rising to an all-time high of $123,000 at the beginning of the month. This reversal surprised the market as the Altcoin market once again bears the brunt of losses. Now, when Bitcoin prices reach important levels, the question is becoming more urgent whether this is the beginning of a bear trend or whether there is a price bounce.
Bitcoin tends to be lower after new highs
After the reversal returned to the $117,000 level, Crypto analyst Tehthomas published an analysis outlining current Bitcoin price trends and where it could head next. So far, analysts have explained that Bitcoin is still trading in a well-defined trend after being rejected from the upper resistance zone multiple times for $120,000. However, there are still many bites from the support level below.
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As analysts explain, the fact that support continues to be held indicates that many purchases are still being made for Bitcoin. This gives you extremely strong support around this area, but also makes it a dangerous area for bulls. Sweeps could return to these lows, and Thomas explains that such a move will engineer sold out liquidity.
There is also a fair value gap (FVG) at the $121,000 level, which continues to be protected. This is where most resistance came into being, with prices already backing down a few times below $118,000. So this FVG is the next level to collect in a campaign for new highs.
Bounces back from low
If it returns towards a low, it could be a move that is not entirely bearish for Bitcoin prices and in fact helps to trigger the next wave of uptrends. Analysts explain that buyers need to return to this level and that they need to sit firmly with support at $116,000. This accumulation during integration is inherently bullish.
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Looking back at FVG, analysts explain that if prices start to rise again, it could act as a magnet. Nevertheless, this all depends on the price of Bitcoin bouncing back to support and again. A liquidity sweep at low prices and bounces will ensure prices continue to rise.
However, there is still a possibility of a breakdown of prices starting here. Thomas points to the invalidation of bullish papers if the $116,000 support is not retained and there is no immediate recovery. “Bitcoin remains trapped in a clear range, and the edge of that range provides the best trading opportunity until a breakout occurs,” the analyst explained.
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