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Bitcoin has flashed some signs of weakness over the past few hours as it begins trending downwards.
This decline has led it to a key support level, which comes as its critical daily and weekly candle closes fast approach.
How it reacts to this level before these candles close could set the tone for which direction it trends in the weeks and even months ahead, as a firm breakdown from here could further confirm that the five-figure price region is simply insurmountable for buyers.
It is important to note that all hope is not lost for Bitcoin, even if it breaks below its support at $9,400.
Analysts are now pointing to a few factors as reasons why the crypto’s mid-term outlook still remains bright.
Bitcoin Declines to $9,400 as Weakness Mounts
Following Bitcoin’s recent rejection at $10,400, the cryptocurrency has been showing some signs of strength due to buyers’ ability to guard against this sparking any type of downtrend.
It does appear that this strength is in jeopardy of being erased, however, as BTC is now approaching its key multi-week support level at $9,400.
At the time of writing, Bitcoin is trading down roughly 2% at its current price of $9,475. This marks a tempered decline from daily highs of roughly $9,700.
The last time BTC dipped to this price region was on Thursday, but the movement proved to be short-lived as buyers quickly absorbed the selling pressure and boosted BTC higher.
If this level is broken below, the next key support levels to watch for sit around $9,100 and $8,800. A break below both of these would be grim for the benchmark cryptocurrency’s mid-term outlook.
Analysts are noting that they expect the cryptocurrency to see some turbulence today due to the looming weekly candle close.
One trader is noting that he still expects bulls to prevail over bears due to BTC’s ability to maintain above its cloud formation.
“Sunday, expecting turbulence. Looking at the cloud as long as daily continuously closes above the greater trend is bullish,” he said while pointing to the chart seen below.
Here’s the Key Area Analysts Claim BTC Must Hold Above
There is a key horizontal support region that analysts also believe Bitcoin must hold above in order for it to see any further upwards momentum.
Another popular pseudonymous trader spoke about this region in a tweet, explaining that he is closely watching to see if BTC is able to hold above the $9,100 to $9,300 area.
He explains that its market structure remains bullish so long as it holds above this level.
“Bitcoin: Looking at something like this in which I find the $9,100-9,300 area to be a substantial zone to hold. Beneath that and we could have further retracements, but, overall, structure is still upwards trending,” he explained.
Featured image from Shutterstock.
