Following Bitcoin’s recent drop into the $3,400 region, it has been able to hold support above $3,400 for an extended period of time, which may ultimately prove to be positive for Bitcoin’s price action. It is important to note that Bitcoin (BTC) has not yet been able to break above $3,500, which appears to be a relative level of resistance for the cryptocurrency.
Although Bitcoin has held steady in the mid-to-upper $3,400 range, one analyst still believes it will see further losses before finding major buying support and possibly reversing.
Bitcoin Steady Above $3,400, Likely to Continue Consolidating in Near-Term
At the time of writing, Bitcoin is trading down approximately 1% at its current price of $3,450. Yesterday, BTC climbed towards $3,500, but failed to break above this price level, leading it to drop today.
After breaking below $3,550 earlier this week, BTC plunged until it reached $3,400, at which point it bounced and climbed towards its current price levels. Because of this reaction to the low-$3,400 price region, it is likely this is the first major support level BTC has established before its 2018 lows exist around $3,200.
Josh Rager, a popular cryptocurrency analyst on Twitter, spoke about Bitcoin’s recent price action, noting that BTC still remains in consolidation, and will not revisit its 2018 lows unless it fails to stay above $3,344.
“$BTC daily chart… This chart has been posted for weeks and nothing has changed… Previous support at $3,344 did not break and bounced at the exact support level… Unless this support breaks, Bitcoin will not retest the previous lows… At this time – $BTC remains in consolidation,” he explained.
$BTC daily chart
This chart has been posted for weeks and nothing has changed
Previous support at $3,344 did not break and bounced at the exact support level
Unless this support breaks, Bitcoin will not retest the previous lows
— Josh Rager ? (@Josh_Rager) January 31, 2019
Some Analysts Are Still Bearish on BTC Despite It Holding Above Support Levels
Although BTC has been able to hold steady above $3,400, some bearish analysts point to the lack of major buying support and equilibrium on a macro-view as a reason why the cryptocurrency may need to fall further before stabilizing and preparing for an upwards move.
A popular cryptocurrency analyst, Moon Overlord, recently noted that because Bitcoin was unable to form any major regions of support during its parabolic upwards climb in late-2017, it may see significantly further losses before it finds major buying support.
“I don’t know what the plan for $BTC on the monthly is, where would you even set bids or start buying. It went up so quickly it didn’t build a single support on the way up,” he said.
I don't know what the plan for $BTC on the monthly is, where would you even set bids or start buying.
It went up so quickly it didn't build a single support on the way up. pic.twitter.com/NfEjnDdRaG
— Moon Overlord (@MoonOverlord) January 29, 2019
Late-yesterday, he doubled down on these recent comments, adding that the lack of major buying pressure at BTC’s current price signals that it may still be bearish on large time frames.
“Not sure why more people aren’t talking about $BTC on high time frames, feels pretty bearish to me Where is the buy support / equilibrium Doesn’t seem like people are dying to buy in this range?”
Not sure why more people aren’t talking about $BTC on high time frames, feels pretty bearish to me
Where is the buy support / equilibrium
Doesn’t seem like people are dying to buy in this range ? https://t.co/95FSXBnAaK
— Moon Overlord (@MoonOverlord) January 31, 2019
If BTC fails to hold above $3,400 in the near future, it will likely find greater buying support in the low-$3,000 region, which will be an important level for bulls to protect or significantly further losses could be in store.
Featured images from Shutterstock.