Bitcoin (BTC) has witnessed a tumultuous past couple of days following Elon Musk revealed support for the cryptocurrency amid the GameStop fiasco on the equity markets. But because that tweet, Bitcoin's cost has been adjusting after the whole drive through Elon Musk was retraced.
Ever since that time, Bitcoin's price is facing a crucial hurdle at the $35,000--$35,200 place before an all-time high evaluation. Once that region breaks and flips for assistance, disposition toward a fresh all-time high is likely.
Bitcoin does not hold $35K and has to reverse it for support
The three-hour graph indicates a clear downtrend arrangement, with the"Elon Musk pump" outlier. This downhill structure was created after the peak high at $42,000 earlier in this year.
This downtrend has seen lower highs and lower extremities, which may be viewed from the graph. Thus, there is a good likelihood that this downtrend will last.
If BTC violates the 35,000 barrier, then the $38,000 resistance zone level should pose not much of a issue for those bulls. The next likely significant area of immunity will be around $40,500.
On the other hand, if Bitcoin's price can not break through $35,000, a renewed retest of the $30,000 amount is on the table. Given that the $30,000 level has witnessed lots of tests because the prior all-time high, there's a good possibility that this amount is going to be dropped. In cases like this, an even additional correction toward $25,000 to $26,000 is on the table.
21-week MA is currently behaving at $21,000
Once more, the only indicator to watch for any additional correction is that the 21-week moving average (MA). In the previous bull cycle, it supplied sustainable support for the whole period.
In the event the market corrects further, though, a retest of the prior all-time high in 2017 remains improbable. In other words, everybody and their mother will be buying there, so the market will probably not offer this opportunity.
As a result, the likelihood of another further correction to $24,000 to $26,000 is still there, which would also fill a CME gap along with a test of this 21-eek MA.
But, this kind of correction is dependent on if Bitcoin's price can break through $35,000.
This detailed chart and scenario reveal that the critical area is the $35,000 zone, which if broken, will open the door to new all-time highs.
That $38,000 zone will see some short-term consolidation. But since BTC has tested this already, it is more likely to watch resistance at $40,500. Therefore, if Bitcoin's price breaks through the $35,000 area, continuation is expected to $40,500.
The bearish scenario is also simple, with $35,000 holding as resistance for additional downside.
The first support is the $32,000 area, which has been tested several times and will likely fail as service. The following area is located between $29,000 and $30,000, which has also been analyzed many times for assistance.
A renewed test and falling through this level would open up the door to $25,000. This will line up with all the CME gap and the 21-week MA. Meanwhile, every prior service level is supported as immunity, together with the correction continuing to put new lower highs and lower extremities.