Over the last 24 hours, Bitcoin has fallen by 2% and now sits at around the $43,300 mark. Trading volume is hovering above $30 billion, something we haven’t seen in quite some time. As we expected, altcoins fell even more. This once again proves that all attention is focused on the first cryptocurrency at the moment. Therefore, capital will continue to flow to Bitcoin and stablecoins.
Let’s take a look at the Bitcoin chart and try to understand which direction it will take in the next few days:
Yesterday, buyers took another attempt to overcome the $45,000 level. As a result, they succeeded and Bitcoin reached $45,820. However, a reversal candle appeared on the hourly chart and the price began to fall. In 8 hours, Bitcoin has declined by 7% from its local maximum.
Also, there is a rising wedge pattern on the daily chart. This usually means that buyers are running out of strength and cannot push the price higher without correction. As of today, the price has already broken the lower border of the wedge and consolidated below it, which just signals the beginning of a local correction. If this pattern works out, the price of Bitcoin may drop to at least $41,000.
Meanwhile, another “double top” pattern was formed on the chart. Right now, the price is testing the bottom of this pattern at the $42,700 level. If bulls fail to maintain it, then the price can quickly drop and settle below the double top figure. In this case, this pattern will work out and Bitcoin may drop to $40,000.
In addition, we were watching the Bollinger Bands indicator on the daily chart. In the last 4 days, Bitcoin has regularly tested the upper band and now starts to bounce down. The nearest support will be the middle line of this oscillator, which currently comes around $39,656. In the nearest future, this line may reach $40,000. Thus, we can conclude that the price may surpass this mark.
At least three factors point to a potential 5-7% decline to the $40,000 – $41,000 area. Moreover, this is where the narrow trading took place last weekend. This can be clearly seen on the 4-hour chart and only reinforces our expectations regarding a local correction that may take place in the next 1-3 days.