The ongoing Bitcoin price rally risks fizzling out on a notion that the price won’t hold a psychological support level.
The $2K-Crash Setup
At lower $13Ks, the cryptocurrency awaits a significant sell-off, according to Mark Principato of Green Bridge Investing, an investment consulting firm in New York. The executive director cited a “potentially bearish candle” – having gone a clear upside rejection near $13,363 – to justify his downbeat outlook.
He provided further evidence – or fractals – that showed traders reacting to the formation of bearish and bullish pin-bars as of late. This year, Bitcoin painted two bullish candles with downside rejections near $9,800 in September 2020 and $10,500 in October 2020.
The cryptocurrency generated two long signals and reached its upside targets near $11,600 and $12,300, respectively. Just recently, it also achieved the third target at near $13,260 from its second long trade.
The chartist added that they now await an exact retracement from lower $13,000-levels before increasing their bets on a fall towards the $11,600-12,300 range (the previous resistance area). Based on where Bitcoin is trading at the time of this writing, that is about a $1,500-$2,000 downside correction.
Bitcoin Price Stability
The aforementioned bearish setup has a better likelihood of concluding should the Bitcoin price achieves stability inside the $11,600-12,300 range.
Mr. Principato stressed two factors that could ensure a price rebound despite a $2K fall. First, holding the said trading area as support; second, forming a bullish pin-bar – wherein a candle wick with a downside bias faces momentum rejection.
Fundamentally, the cryptocurrency shows demand near the $11,600-$12,300 area. In an email statement to Bitcoinist, CEX.io’s Executive Director Konstantin Anissimov noted that “Bitcoin has brought a lot of attention to the crypto market” as major firms add it to their reserves as a hedge against currency devaluation.
Mr. Anissimov, nevertheless, added that – technically – failure to hold support above the $13,000-area would risk taking Bitcoin lower towards $12,000.
The BTC/USD exchange rate was 0.22 percent high as of the early Monday session, trading at $13,070.
Originally from Bitcoinist.com https://ift.tt/2Tsic7H
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