The Bitcoin (BTC) price experienced a bounce two weeks ago, but it was unable to sustain this momentum last week. This has raised doubts about the possibility of a bullish trend reversal. To confirm a bullish trend, BTC would need to break out from a descending resistance line in the daily timeframe.
In terms of the weekly timeframe, the BTC price bounced off the crucial $24,800 horizontal area, which has acted as both resistance and support since July 2022. As long as the price remains above this level, it is possible that the ongoing decrease is just a retest of the area, validating it as support.
However, last week, BTC failed to sustain its increase. Despite reaching a local high of $27,486, the price closed bearishly with a long upper wick, indicating that bulls could not maintain the upward movement. If the decrease continues, the $24,800 area will be 5% below the current price, while a 20% increase would be needed to reach the $31,000 resistance area.
The weekly RSI is currently undetermined, with traders using this indicator to assess market conditions. A reading above 50 with an upward trend indicates an advantage for bulls, while a reading below 50 suggests the opposite. Although the RSI is slightly below the 50-line, it is still above the bullish divergence trendline that started in July 2022. As long as this trendline holds, the trend can still be considered bullish.
In the daily timeframe, the technical analysis also presents conflicting signs. On the bullish side, the price reclaimed the $25,600 horizontal area after briefly deviating below it. However, the price failed to break out from the descending resistance line that has been in place since the yearly high, leading to a rejection.
Similar to the weekly timeframe, the daily RSI is near the 50-line. The closest support level is at $25,600, while the $29,250 resistance area is 12% above the current price.
Therefore, the near-term BTC price will largely depend on whether it breaks out from the descending resistance line or breaks down below the $25,600 area. A breakout would likely lead to a 10% increase to $29,250, while a breakdown could cause a drop to $24,800.
It’s important to note that this price analysis should be considered informational and not financial or investment advice. Market conditions can change rapidly, so it’s crucial to conduct your own research and consult with a professional before making any financial decisions.