Bitcoin at a Crossroads: Key Technical Levels in Focus
Prominent crypto analyst Michaël van de Poppe, known for his insightful take on Bitcoin (BTC) trends, has hinted at an upcoming pivotal moment for the digital currency. In the following few days, the analyst suggests that the trajectory of Bitcoin could be significantly influenced, keeping his 657,000-strong Twitter audience engaged and on their toes.
Van de Poppe highlights the importance of a potential retest of Bitcoin’s 200-week moving average (MA) as a critical support level. In technical analysis, the moving average is a statistical tool that smoothes out price data by creating a constantly updated average price, thus helping to identify trends. The 200-week MA, in this context, represents the average closing price of Bitcoin over the last 200 weeks. If Bitcoin successfully holds this level as support, it could indicate the end of the current correction phase, according to Van de Poppe.
Historically, Van de Poppe maintains that the 200-week MA has often proved to be an excellent period for Bitcoin accumulation, as it’s generally represented a undervalued state for the cryptocurrency. Indeed, in the last half a year, Bitcoin has been trading below this level for an extended duration, signifying an unparalleled undervalued phase since its inception.
As the next week unfolds, the digital asset might face a “make-or-break” situation. According to the analyst, a rapid upward breakout could mark the end of the ongoing correction. At the time of writing, the 200-week moving average was observed to be approximately $26,283.
Furthermore, Van de Poppe adds that Bitcoin’s recovery and potential future rallies might be sparked by the successful reclaim of a pivotal support level in the lower time frame. Conversely, if Bitcoin fails to achieve this, the cryptocurrency might find itself trading at a lowly figure, potentially as low as $26,000, before any significant rebound can materialize.
He also illustrates the “classic choppy pattern” that Bitcoin currently demonstrates, exemplifying this with a rejection at $27,200 and subsequent consolidation. Interestingly, he notes that the Chicago Mercantile Exchange (CME) gap is also hovering around $26,900. In trading parlance, a “gap” refers to a discontinuity in the price chart of an asset, often occurring when the price makes a sharp move up or down with no trading happening in between.
According to the analyst, Bitcoin needs to decisively break and flip the $27,200 resistance level to see any sustained upward momentum. The critical support to watch, as per his analysis, lies between $26,000 and $26,500, a region that also coincides with the 200-week MA.
At the moment, Bitcoin’s price stands at $26,814, marking a slight decline of 0.26% over the past 24 hours.
Source: Read Full Article