Watch Out for These Levels in Bitcoin's Price as Investors Search for New Catalyst
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Source: TradingView.com
Key TakeawaysBitcoin shed more that 12% in the second quarter as investors appeared to sit on the sidelines looking for a new catalyst to counter dwindling spot Bitcoin ETF inflows and uncertainty about when the Federal Reserve might start cutting interest rates.BTC continues to trade near the lower portion of a trading range, with the relative strength index moving towards oversold levels, indicating weakening price momentum.Upon a breakdown below the trading range, the BTC price may find support around $53,000, $44,000, and $38,000.The measuring principle, which calculates the distance between the trading range’s lower and upper trendlines and adds the amount to the pattern's top trendline, projects a price target of $87,300.
Bitcoin (BTC) shed more that 12% in the second quarter as investors appeared to sit on the sidelines looking for a new catalyst to counter dwindling spot Bitcoin exchange-traded fund (ETF) inflows and uncertainty about when the Federal Reserve might starting cutting interest rates.Despite softening sentiment, Bitcoin bulls may find solace that the digital asset has returned an average of 7% in the month of July between 2013 and 2023, according to data from crypto analytics site Coinglass.Below, we use technical analysis to spot key levels of interest on Bitcoin’s chart that investors may be watching this quarter.Levels to Watch Amid Weakening Price MomentumSince reaching its record high in mid-March, Bitcoin has oscillated within an orderly trading range on below-average volume, highlighting a lack of enthusiasm by market participants. In recent weeks, BTC continues to trade near the lower portion of the range, with the relative strength index (RSI) moving towards oversold levels, indicating weakening price momentum. Amid a breakdown below the range’s lower trendline and 200-day moving average, investors should monitor three key levels.Firstly, it’s worth keeping an eye on the $53,000 area, a region on the chart that could attract buying interest around a period of consolidation as Bitcoin trended higher throughout February.A close below this level could see a move down to around $44,000, where the cryptocurrency would likely find support from price action between December 2023 and February this year.A more significant correction could see the digital asset’s price revisit the $38,000 level, which sits near a four-week period of consolation that formed as part of the broader uptrend in November last year.Monitor This Level Amid New Record HighDespite the technicals pointing to near-term weakness, it’s also worth identifying an upside price target to gauge an area on the chart where investors may book profits if the legacy cryptocurrency goes on to make a new all-time high (ATH). We can do this by using the measuring principle. First, we calculate the distance between the trading range’s lower and upper trendlines in dollars and add this amount to the pattern's top trendline. In this situation, we add $14,500 to $72,800, which projects a price target of $87,300.The comments, opinions, and analyses expressed on Investopedia are for informational purposes only. Read our warranty and liability disclaimer for more info.As of the date this article was written, the author does not own any of the above securities. Read the original article on Investopedia.
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