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Today, BTC went through some massive volatility. Accordingly, the trading volume on Binance increased exponentially. The price is struggling to hold above the $18K level, and the potential for further correction is causing fear across the market.
Technical Analysis
By Grizzly
The Daily Chart:
On the daily chart, Bitcoin is trading slightly above $18K, one of the lowest levels since the market crash in June. Throughout this period, this crucial level (in yellow) has been significant support, preventing Bitcoin from plunging further.
The 14-day Relative Strength Index (RSI) is close to its diagonal support line (in white). If the downward price action continues and the pair closes below $17.6K, the way to the next support at $16K appears to be clear. This corresponds with the RSI approaching the oversold zone below 30. In the worst-case scenario, the RSI may remain below 30 for an extended period of time, perhaps resulting in Bitcoin reaching $14K on the price chart.
Alternatively, if buyers push the price over $20.5K, the bullish sentiment will be back in the market in the short term.
Key Support Levels: $17.6K & $16K
Key Resistance Levels: $20.5K & $22.7K
Daily Moving Averages:
MA20: $19349
MA50: $19757
MA100: $21084
MA200: $26752
The 4-Hour Chart:
The pair is approaching the support of the descending line (in green) on the 4-hour chart, which is about $18K. Touching this support in prior downward waves has coincided with price movement toward the diagonal resistance. If history repeats again, the potential of reclaiming the $19K would be high. Otherwise, the daily support of around $17.6K is what most of the speculators have their eyes on.
It should be highlighted that if the price closes over $19.6K in this timeframe, the hopes for bulls to enter the market will be revived.
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Cryptocurrency charts by TradingView.
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