Bitcoin Price Forecast BTCs Bleak Outlook Persists as Key Support Level Crumbles

Crypto World analyst Josh has conducted a thorough analysis and concluded that Bitcoin is currently being rejected by a critical resistance area, leading to a potential test of a significant support level. This same pattern can also be observed in Ethereum, as it is rejecting an important Fibonacci level.

In terms of recent price movements, the Super Trend indicator on the 4-day Bitcoin chart provides insights. Despite the price of Bitcoin briefly dropping below $56,000, the 4-day candle ultimately closed above this level. This closing has, at least for now, prevented the emergence of a bearish reversal signal on this timeframe.

The level to closely monitor is just below $56,000. If the subsequent 4-day candle closes below this threshold, it would confirm a bearish reversal and cause the indicator to transition from green to red. Historically, such reversals have signaled the beginning of prolonged bearish trends.

Turning to the daily Bitcoin chart, following a short-term bounce, the price is now retesting support levels between $56,500 and $57,500. A confirmed bullish divergence on the daily timeframe indicates the possibility of either sideways consolidation or slight bullish relief in the short term.

Nevertheless, it is crucial for Bitcoin to maintain support above $56,500 in order to avoid an extended downturn. Earlier today, the price briefly fell below $55,500. If the price once again loses support at the $56,000 level, it could potentially confirm the analyst’s prediction of a bearish trend.

The analyst also highlighted the liquidation heat map, noting that over the past day, Bitcoin has cleared a significant amount of upside liquidity. He pointed out that the liquidity between approximately $57,000 and $57,500 has largely been wiped out. However, there is still a substantial area of liquidity just below $59,000, specifically between $58,800 and $58,900. The analyst suggested that Bitcoin may soon reach close to $59,000 in order to clear out this remaining liquidity.

Tags: Bitcoin, Crypto news, Cryptocurrency, Price Analysis.