Bitcoin (BTC) has found itself caught firmly within a bearish downtrend over the past several weeks, which has led its price to plummet down to $7,000, with today’s drop marking a full retrace of the gains that were incurred in late-October.
Analysts are now noting that Bitcoin is currently trading at a key long-term technical support level, which has historically catalyzed massive movements when it is ardently defended by buyers.
Bitcoin Plummets Below $7,000 Amidst Sharp Overnight Sell-Off
At the time of writing, Bitcoin is trading down 12% at its current price of $6,950, which marks a massive drop from its daily highs of nearly $8,000.
Bitcoin’s overnight drop below $7,000 marked an extension of the downwards momentum that was incurred yesterday when BTC plummeted from $8,000 to the mid-$7,000 region.
In the near-term, it is highly likely that Bitcoin will pause its descent at this level, as the $6,900 to $7,200 range marks the crypto’s “golden pocket,” which may allow it to find some much needed buying pressure that catalyzes a short-term rally.
Big Chonis, a popular cryptocurrency analyst on Twitter, spoke about this support level in a recent tweet, noting that it would be a “shame” to break below it.
“$BTC – the ‘golden pocket’ has been hit… it would be a shame to lose it as support,” he explained while pointing to the chart seen below.
$BTC – the “golden pocket” has been hit… it would be a shame to loose it as support #bitcoin pic.twitter.com/XyTzLnPAGT
— Big Chonis⚔️Chonis Trading 🚀 (@BigChonis) November 22, 2019
BTC Hits Critical Technical Support Level; Massive Movement Could be Inbound
In addition to reaching its “golden pocket,” Bitcoin has also visited its 89-week EMA, which is a price region that is often ardently defended by bulls and may catalyze a massive bull movement in the near-term.
Mr. Anderson, a popular cryptocurrency analyst on Twitter, spoke about this possibility in a recent tweet, explaining that visits to this region are often closely followed by big movements.
“$BTC Fight for the 89-Week EMA back in play for Spot BTC. This is an area that is often fought for and often produces large moves once the war is won,” he explained while referencing the below charts.
Fight for the 89-Week EMA back in play for Spot BTC
This is an area that is often fought for and often produces large moves once the war is won pic.twitter.com/DOg2l9QXxh
— Mr. Anderson (@TrueCrypto28) November 22, 2019
How BTC responds to its near-term support levels could offer significant insight into which direction the markets will trend as 2019 draws to a close.
Featured image from Shutterstock.
