Bitcoin price dips below $37K as a descending channel pattern comes back into play
Bitcoin’s repeat visit to the sub-$37,000 range is re-enforcing analysts’ view that BTC is either set for a lengthy consolidation or further downside.
The crypto market is once again in the red on Feb. 2 as global financial markets continue to see increased volatility.
Here is what several analysts and traders are saying about Wednesday’s Bitcoin price action and what areas to keep an eye on moving forward.
Bulls are in trouble below $36,700
Insight into the major support and resistance zones of note for Bitcoin was provided by crypto trader and pseudonymous Twitter user ‘HornHairs’, who posted the following chart indicating a solid level of support near $37,400.
According to the analyst, after finding support at this level, “a move back to $38,000s is just a bearish retest unless we can reclaim $38,700.”
That being said, a bearish move could see the price continue to slide lower with the chart above indicating that bulls are in trouble below $36,781.
“A drop below $36,700 and a move to take out range low seems likely, seeing as we took out the range high yesterday.”
Will the fourth attempt be the charm?
A look at the descending price action for BTC since topping out in November was provided by crypto trader and pseudonymous Twitter user ‘Daan Crypto Trades’, who posted the following chart highlighting the difficulty Bitcoin has had at breaking above this trend.
Daan Crypto Trader said,
“Everyone seems to be watching this same line now which could cause for some fakeouts. So be cautious for that. It’s currently testing the diagonal for the 4th time. When will it break?
“A fully intact bull market that is consolidating”
A forward-looking analysis on what could come next for Bitcoin was summarized by technical analyst and pseudonymous Twitter user ‘Decodejar’, who posted the following chart outlining a possible move lower for the top cryptocurrency.
According to Decodejar, this is a common chart being circulated by analysts which shows a “bearish ABC wave 4 expanded flat, ending below last year’s lows.”
While this is a common pattern, Decodejar indicated that “there’s not much volume for an impulse” and he doesn’t “think we break last year’s lows.”
“What this all boils down to is that the correction is likely almost done at these levels, even if the market needs more time. What I do not see is a bear market, in fact, I am sick of hearing it. I see a fully intact bull market that is consolidating.”
The overall cryptocurrency market cap now stands at $1.729 trillion and Bitcoin’s dominance rate is 41.1%.
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