Bitcoin’s strong price action has shown some signs of faltering as the cryptocurrency’s price declines down towards $12,000 following yesterday’s sharp upswing.
This level – which was previously heavy resistance – may soon be confirmed as support as the cryptocurrency’s price begins drifting lower.
Analysts are now widely noting that BTC is well-positioned to see further upside in the days and weeks ahead, which could potentially lead it as high as $13,600.
This mid-term technical strength, however, does not mean that the cryptocurrency won’t see any short-term downside, as there are a few factors that seem to indicate a slight move lower is imminent in the days and weeks ahead.
Bulls and bears are currently battling for control of the key $12,000 region, as any sustained break beneath this level may lead it to plunge significantly lower.
Bitcoin Shows Signs of Weakness as Bulls Defend $12,000
Bitcoin may be currently undergoing a potential support-resistance flip.
After spending weeks trapped beneath $12,000, the cryptocurrency is now in the process of testing this level as support.
At the time of writing, Bitcoin is trading down just over 2% at its current price of $12,050. This marks a slight rebound from lows of $12,000 that were hit just over an hour ago.
If bulls can catalyze a sharp upswing at this price level, Bitcoin will likely be able to start a fresh leg higher that potentially sends it surging up towards $13,000.
One trader pointed to the ongoing decline, noting that this selloff has been “clean” and has yet to invalidate the cryptocurrency’s strong mid-term uptrend.
“Clean so far for BTC on the sell off,” he said while pointing to the chart seen below.
Image Courtesy of Cold Blooded Shiller. Chart via TradingView.
If BTC posts a sustained break below $12,000 that results in it closing a high time frame candle beneath this level, then the crypto could soon invalidate its newfound technical strength.
Here’s How High BTC May Surge if Bulls Defend Crucial Resistance
If Bitcoin’s buyers step up and defend against any further downside, the cryptocurrency may be positioned to see an explosive rally up towards $13,600.
One analyst put forth this target in a recent tweet, pointing to the mounting support in the lower-$12,000 region as a factor that suggests upside is imminent.
“BTC building support at the minor breakout level yesterday $12.17k on route to $13.57k.”
Image Courtesy of Harry. Chart via TradingView.
Whether or not Bitcoin can navigate any higher in the near-term depends almost entirely on whether or not it will be able to hold above its key support within the lower-$12,000 region in the coming hours.
Featured image from Unsplash. Charts from TradingView.