Sunday, February 7, 2021

Bitcoin Price Remains at Risk Despite Recent Surge

Yesterday’s Bitcoin price action saw the price of the cryptocurrency surge above $40,000. Then it started a downside correction against the US dollar. As it climbed above the $38,000 resistance level, it struggled to stay above $40,000.

This past week was a bullish shift for the pioneer cryptocurrency. It initially soared above the $36,000 resistance level against the dollar. After a three day upward momentum, it broke the $38,000 support level, moving the cryptocurrency into a positive zone.

It settled above the 100 simple moving average (4-hours) after crossing the $40,000 hurdle. At 11:33 GMT on Sunday, a BTC was trading at $39,520, a 1.55% loss over the last 24 hours.

The price even traded below the 23.6% Fib retracement level of the upward move from the $36,217 swing low to $41,050 high.

tradingview chart

The 4-hours indicate that there’s no bullish trend line forming. The 50% Fib retracement level of the upward move from $36,217 low to $41,050 high. This is near the trend line of support.

If there is a down-slide below the key support areas, Bitcoin would be witnessing a larger decline.

If Bitcoin stays above the trend line support, there are chances of major increase to new ATHs. There will be a sustained move upward in the coming session. The next major resistance on the upside trend will be around $41,500.

Technical support and resistance levels

4 hours MACD – The MACD for BTC/USD is slowly gaining momentum in the bearish zone.

4 hours RSI (Relative Strength Index) – The RSI for BTC/USD is still above the 50 level.

Major Support Level – $38,600

Major Resistance Level – $40,000

MicroStrategy may be the key to the resistance level

Something to consider that may cause a bull rally is the ongoing Microstrategy’s conference.

The CEO, Michael Saylor said that the firm decided to buy significant Bitcoin quantities over cash as a response to macroeconomic factors. In a Press release, the firm outlined why it is going the Bitcoin way:

MicroStrategy spent months deliberating to determine our capital allocation strategy. Our decision to invest in Bitcoin at this time was driven in part by a confluence of macro factors affecting the economic and business landscape that we believe is creating long-term risks for our corporate treasury program? risks that should be addressed proactively.

In the coming days, it will be important to watch investors buy more or buy Bitcoin as a result of the conference.

If you have any questions and comments on Bitcoin today, use the form below to reply.

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