Bitcoin is still consolidating after its recent test of the ascending channel resistance, keeping the correction going. Price seems to have bounced off the 38.2% Fibonacci retracement level but might still be due for a larger dip.
The 100 SMA is above the longer-term 200 SMA to indicate that the path of least resistance is to the upside. In other words, the climb is more likely to gain traction than to reverse. The 100 SMA is also currently holding as dynamic support and could continue to keep losses in check.
RSI is still pointing down to signal that sellers have the upper hand and could stay in control until oversold conditions are met. Stochastic is already dipping into the oversold region to signal that selling pressure is about to be exhausted and that buyers could return soon.
A larger pullback might find more buyers at the area of interest that lines up with the 61.8% Fib, channel bottom, and a former resistance around the $4,000 major psychological mark. If any of these support levels hold, bitcoin could resume the climb to the swing high at $4,170 or the channel top closer to $4,200.
Many are noting how bitcoin is at a make-or-break point as a decline from current levels would confirm that investors are still very much hesitant when it comes to placing bets on the cryptocurrency. A continuation of the rally, on the other hand, could take it up to the elusive $5,000 mark next or even for a stronger rebound.
Traders are still waiting to get more developments in the industry to sustain any rallies, counting on a pickup in volumes coming from institutional investors this month. So far, there hasn’t been much word on this, which explains the consolidation.
There have been a few minor updates, namely bitcoin acceptance from Swiss online retailer Digitec Galaxus AG and Phoenix-based Avnet.
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