Bitcoin has once again found itself caught within a bout of sideways trading as it struggles to garner any momentum as it hovers around the $8,800 region.
This is around the price point at which it has been trading at throughout the past couple of days, and it does appear to be a critical support level.
Although buyers have been ardently guarding against a dip below this price, analysts are noting that the benchmark cryptocurrency’s high time frame outlook seems to greatly favor sellers, with one even going so far as to note that the crypto could soon be trading within the $5,000 region.
This is where a massive amount of support exists, but there are a few other price regions before this level that could bolster BTC.
Bitcoin Consolidates Around $8,800 as Buyers Guard Against a Significant Selloff
At the time of writing, Bitcoin is trading down just over 1% at its current price of $8,820.
Earlier today Bitcoin dipped as low as $8,700 before buyers stepped up and absorbed the immense selling pressure that drove this movement.
Which direction BTC trends in next will likely be determined by how it reacts to this level.
Traders don’t seem to think that its near-term outlook is too bright, however, as Cantering Clark – a popular cryptocurrency analyst – recently explained that he is now focused on shorting BTC until it posts a bullish reaction to either $7,300 or $6,800.
“Likely done with any longs outside of intraday plays, i.e. longer swing positions, until we put in some type of strong PA down in blue. Bitcoin is pretty formulaic, lose black and you are coming down to ugly numbers,” he explained while pointing to the chart seen below.
Trader: BTC’s Next Decline Could Cut as Deep as $5,000
Another trader recently offered a far grimmer outlook on the benchmark cryptocurrency’s mid-term outlook, putting forth a chart showing a target within the $5,000 region.
As seen on the chart below, Bitcoin’s recent decline below its wide trading range’s equilibrium has opened the gates for a movement to its range lows that sit within the mid-$5,000 region.
The analyst’s chart seems to signal that this is where the downtrend will end, as it is a significant demand zone.
It is important to note that there are multiple key support regions prior to this level that could stop Bitcoin from seeing a capitulatory decline.
The “heat” regions seen on the below Bookmap indicate that there is significant BTC buying pressure around the lower-$8,000 region. If this is broken, there is some slight support at $6,500 that could temper the decline.
The support here is rather weak from the looks of it, which means that $8,000 will be the key level that must be defended if bulls want to thwart a decline to $5,000.
Featured image from Shutterstock.
