Bitcoin (BTC) has made a bearish breakout of the $ 46,300 horizontal support area, but the fate of the long-term support at $ 44,300 has yet to be decided.
Bitcoin sank sharply, falling to a low of $ 42,500. As a result of this drop, the BTC rate broke through the horizontal support area of $ 46,300, which remained unbroken for 32 days.
A bearish breakout of such a long-term level is a very bearish signal.
The price is now approaching the December 4th low of $ 42,000.
The fall BTC
On short timeframes, you can see that the trading volumes were quite decent (red icons), but they still significantly fall short of the volumes, against the background of which the BTC rate decreased on December 4.
In addition, Bitcoin is moving along the line of downward support. So far, the price has already tested this line for strength four times (green icons). The last time such testing took place was on January 6th.
As long as the coin continues to hold above this line, the likelihood of a bounce and reversal will remain high.
In case of a rebound, the area of $ 46,300 will play the role of resistance.
A source: TradingView
Long term dynamics
On the daily chart, BTC is currently trading below the $ 44,300 support area formed by the 0.618 Fibo retracement level.
To continue the development of a long-term bullish trend, Bitcoin must definitely not allow daily trading to close below this level.
In addition, technical indicators continue to show bullish signs. In particular, the MACD and RSI indicators are still giving bullish divergence signals.
Thus, the probability of a price reversal will persist until both of these indicators form lower lows, canceling the bullish divergence.
A continuation of the BTC drawdown could force both indicators to neutralize divergence signals and cause a bearish breakout of the long-term support of $ 44,300.
Read previous technical analysis for bitcoin can be here.
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