Crypto Daily: Weak Buyers May Cause the Market Fall

Jan 18, 2022
09:01
2 min reading

Choise.com team

Over the last 24 hours, the Bitcoin price has decreased by 2% to below the $42,000 mark. At the same time, the BTC trading volume shows an extremely low level of $19 billion. Altcoins have followed suit – just as we had predicted – and also declined. The market remains in a state of high uncertainty.

Let’s take a closer look at the Bitcoin chart and try to figure out where it may head to this week:

Yesterday, Bitcoin ran into a downward trend line again and didn’t manage to overcome it as buyers are either still staying away or feeling extremely weak. On the chart, there are no significant bounces that usually come after drops. Meanwhile, volatility continues to decline. All this reminds of a compressible spring, which can be unclenched at any moment. And after that, the price can start a sharp movement, similar to what happened on December 4, 2021.

Now, the chart is floating near the $42,000 mark. At the same time, yesterday’s daily candle almost formed a “bearish engulfing” pattern, and this should be taken into account. The nearest support level is $40,000 from where the price has rebounded already three times this year. Therefore, Bitcoin will tend to approach this area, which means an approximately 5% decrease is inevitable.

If buyers keep demonstrating the same weakness here, the market will fall even further. Most traders have set stop-losses for the immediate low at around $39,600. So, once this level is reached, there may be an avalanche moving down to the $37,000-$38,000 range. This scenario can turn into reality any day this week.

The aforementioned level is the last stronghold that will contain the fall to the important psychological mark of $30,000. So far, the chances of sellers to break through the $37,000 level are small, but they exist nevertheless. Therefore, it is necessary to remember this alignment.

There are still a few options for the growth of Bitcoin. To begin with, the price should fix above the downtrend at least in the daily timeframe and then rise to $46,000. However, given the current state of the market and the weak sellers, this is unlikely to happen.