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All Eyes on the Charts: Bitcoin Nears Key Levels as Price Crashes Under $8,900

Avatar Nick Chong 1 month ago

Bitcoin, as put by a number of analysts, is “puking.” As of the time of writing this article, the cryptocurrency has plunged to $8,850 on most major crypto exchanges, with BTC posting a performance of -5% in the past 24 hours.

This price action over the past 24 hours has liquidated $55 million worth of BitMEX positions, per data from Skew, shaking out the many investors who had longed BTC in the low-$9,000s, expecting a return to $10,000 and beyond.

With the sell-off shows no signs of abating — the Bitcoin price continues to trend lower as I write this (now at $8,800) — analysts are saying it’s time to keep a close eye on the charts, for BTC is rapidly approaching key levels of support.

Bitcoin At Key Supports Around $8,800, Analysts Say

According to a number of analysts, Bitcoin is currently in a key support region, which should hold if a bullish narrative is to be touted moving forward.

Filb Filb — an extremely accurate cryptocurrency trader who called Bitcoin’s price action for all of Q4 and the subsequent recovery into January and early-February — recently posted the below chart, showing that BTC has entered a region of “support confluence.”

More specifically, it just encountered the essential 200-day moving average, which analysts say is crucial for BTC to hold, as it would confirm the bull run narrative remains alive. Filb Filb claims that this is a region that should offer traders the opportunity to enter in on “good risk-return longs.”

There’s also Big Chonis, another well-known cryptocurrency trader, who noted that Bitcoin is in the midst of nearing the lower band of the one-week Ichimoku Cloud, now at $8,500.

While the two analysts are currently eyeing different levels, the theme is clear: BTC failing to hold this region may suggest a return to a decisive medium-term bear trend, as a close under the Ichimoku Cloud and the 200-day moving average would suggest a reversion to a medium-term bear trend.

Just a Bottom Wick? 

While there are fears of an extended bear market, some are convinced that the recent price action is but a bottom wick in the long-term trend of Bitcoin. Cryptogainz, a popular commentator and trader, just recently wrote:

“If 8.5k caves, even heavier bids at 8.2k. If 8.2k caves, monstrous bids at 7.8k. $btc is macro bullish. All this pushdown is doing is likely creating a monstrous bottom wick on a higher timeframe imo.”

His assertion that Bitcoin remains “macro bullish” has been echoed by a number of other analysts and investors, such as Willy Woo, who suggested in December that on-chain metrics are suggesting BTC is still in the midst of a bull run.

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Nick Chong

Since 2013, Nick has shown interest in Bitcoin and cryptocurrencies. He has since become involved in the industry as a full-time content creator, working for NewsBTC, Bitcoinist, LongHash, among other outlets. Aside from covering...

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