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The rest of the cryptocurrency market also turned downward yesterday, dropping by an average of 3% per day.
Let’s take a look at the Bitcoin chart and try to figure out the direction that it will take in the coming weekend:
Since the end of October, the Bitcoin chart has been moving within a large descending channel. After the collapse had occurred on the night of December 3 to 4, the price started a sideways movement and Bitcoin slightly lost its value. At the same time, the support level was formed quite clearly next to the middle line of the descending channel. Bitcoin has already reached this area 3 times and always bounced up.
This also means that the selling pressure has now become much stronger. Sellers are trying to press down and we got to admit that they have succeeded, so far. The local support level of about $46,650 was formed at the chart, as well. This is an important zone for the first cryptocurrency, as here is exactly where we have watched a struggle between buyers and sellers in the last 4 months and even more.
But the far more important area where the price will move to is the $43,500 level. This is where the middle line of the downward channel and the uptrend line intersect. These intersections often magnetize the price. Moreover, we can see the lower Bollinger line next to this mark, which further strengthens the given area.
Below this mark there is an important $40,600 – $43,200 zone. This is where the major support level was formed in the second half of September 2021. Bitcoin broke the downtrend around those levels and began to grow, eventually setting a new historical maximum. That is why the $40,000 level is extremely important for the entire market.
If the chart fails to consolidate higher and falls below $40,000, then this will mean a downward reversal of the global trend. In this case, the price may reach $30,000 quite quickly. However, we consider such an alignment is less likely at the present moment and believe that Bitcoin will reverse in the specified range. A purchase entry of about $40,000 would be considered best in terms of risk management.