Bitcoin (BTC) faces an uphill climb to reignite its uptrend after its biggest single-day loss of 2023.
The largest cryptocurrency continues to recover after falling to a low of $40,200 at the close of the week on December 10, according to the latest data from Cointelegraph Markets Pro and TradingView. .
New key support and resistance levels are emerging as BTC price action breaks away from the relentless gains that many claim are overdue.
The next few days will present many opportunities for potential volatility. US macro data releases begin on December 12, followed by the Fed’s interest rate decision and Chairman Jerome Powell’s comments the following day.
The stage is set for a showdown that could involve more than just the cryptocurrency market.
Cointelegraph takes a look at some of the popular BTC price lines that are currently on the radar for traders and analysts as Bitcoin barely manages to stay above the $40,000 mark.
Bollinger Bands: BTC bounces “as expected.”
Although it has been painful recently, the 7.5% drop in BTC price after the weekly close provided a reset of sorts for the frenzied cryptocurrency market.
#Bitcoin It’s currently down 7.5%, which would be the biggest single-day decline of 2023.
This exceeded the decline in March during the banking collapse. -6.2%, bottoming out at $20,000.
Additionally, in August, when Bitcoin bottomed at $26,000, it fell -7.2%. pic.twitter.com/WFYiyURO3J
— James Van Stratten (@jimmyvs24) December 11, 2023
The consensus agrees that this is necessary because unchecked uptrends typically lead to violent reactions the longer they persist.
“It was so overextended that a downturn was expected,” said John Bollinger, creator of the Bollinger Bands volatility indicator. assert This is a response to X (formerly Twitter).
“If I had to do that, I would have stopped right away. That doesn’t happen too often. “Now we are looking to see if the support can be maintained.”
Bollinger cited Bollinger Bands data, along with charts that, among other things, show the strength of the latest uptrend in the context of the broader recent BTC price strength.
On the daily time frame, the decline took Bitcoin straight up to the middle band within the Bollinger Channel, correcting a textbook move and sparking optimism going forward.
The air is getting a little thinner here, but for now all we see are signs of strength. We got off both the daily and weekly BBs with no difference. The last control formation was a 2-bar reversal of the middle BB, completed on November 21st. $BTCUSDhttps://t.co/B4ZU3vpTvV
— John Bollinger (@bbands) December 5, 2023
Meanwhile, Bollinger warned of an increasingly contractionary situation that could foreshadow local highs the week before.
Large Bitcoin buyers can make the “buy dip, sell dip” play.
Looking at the behavior of large traders, some commentators are seeing encouraging signs after open interest plummeted.
Uploading Following overnight liquidity printing on the BTC/USDT order book on the largest global exchange, Binance, trading resource Material Indicators revealed a new support zone at $38,500.
Material Indicators suggested “institutional size” bids could now bounce back, albeit below $40,000 and this week’s lows. However, there is a caveat.
“It is not yet clear whether they have legitimately started to accumulate at these levels or whether they are simply buying dips and selling dips,” the accompanying analysis concluded.
“Ultimately, a Fed rate hike decision is expected to be made this week and #JPow’s speech is generally good for some volatility,” he added.
On December 12, Skew, a perennially popular trader, likewise considered the possibility of manipulation among large players.
“We’ve seen a bit of a shift in the mindset of the big spot players who were previously aggressively chasing price,” he said. said X number of followers for Binance order book.
“The current mentality seems to be to buy dips and sell dips until bid depth and liquidity improves to allow large amounts of capital to be returned.”
Skew predicted the key BTC price zones to be $38,000-$40,000 and $44,000-$45,000, respectively.
Analyst: Bitcoin will close the year in a “new range”
In terms of key support, popular trader Ali further mentioned the around $38,000 range as a strong barrier to a major downtrend.
Related: Price Analysis 12/11: SPX, DXY, BTC, ETH, BNB, XRP, SOL, ADA, DOGE, AVAX
“In case of a deeper correction, Bitcoin finds solid support between $37,150 and $38,360. This zone is backed by 1.52 million addresses holding $534,000 BTC,” he said. showed With data.
“Also watch out for two resistance walls that could block the BTC uptrend, one at $43,850 and the other at $46,400.”
Michaël van de Poppe, founder and CEO of MN Trading, listed the floor zone as slightly lower at $36,500.
He believes Bitcoin should end in a “new range” in 2023.
Critical levels to maintain #Bitcoin In higher terms it is $36,500-38,000.
This correction could see a bounce back from $39,500-40,000 to $42K+.#Bitcoin It is likely that a new product range will be launched before the end of this year. pic.twitter.com/bmQIREzEW8
— Michael van de Poppe (@CryptoMichNL) December 11, 2023
This article does not contain investment advice or recommendations. All investment and trading activities involve risk and readers should conduct their own research when making any decisions.