- Bitcoin price saw an explosive 9.3% growth between October 25 and 29.
- Due to the developing bearish divergence, BTC could slide lower and revisit the $19,700 support structure.
- A successful flip of the $21,000 hurdle into a support floor will invalidate the bearish thesis for the big crypto.
Bitcoin price saw a surge in buying pressure between October 25 and 29, which propelled it to set up two distinctive tops. Due to the inherent bearish nature of this structure, BTC is likely to retrace lower and clear the imbalance.
Bitcoin price needs to shed weight
Bitcoin price consolidation from October 13 saw a conclusion on October 25 as it rallied 9.3% and set up a local top at $21,030. This explosive move was followed by a minor pullback to $19,951, which resulted in a 5.6% upswing.
In hindsight, this move was a liquidity run as Bitcoin price produced a higher high at $21,083. Since this point, BTC has dropped 3% and is currently trading at $20,453. A lower low below the $20,000 psychological level will reinforce the bearish outlook.
The second reason why Bitcoin price could slide lower is that the higher highs produced on October 26 and 29 seem to diverge from the Relative Strength Index’s (RSI) lower highs. This setup is known as bearish divergence and indicates that the asset’s value is rising despite the declining momentum, which will eventually lead to a reversal for the underlying asset.
Moreover, a move lower will also provide a rebalance to the inefficiency that Bitcoin price created on its way up. Therefore, interested investors can open a short position and book profits at the $19,700 support level.
The aforementioned level is an ideal place to accumulate. If there is enough bullish momentum, Bitcoin price will likely continue its uptrend and revisit the next significant level at $22,106.
BTCUSDT 4-hour chart
While things are looking gloomy for the Bitcoin price, a successful flip of the $21,000 hurdle into a support floor will bid adieu to the bearish divergence in play. This development will invalidate the pessimistic outlook for the big crypto and propel it to $22,106, which is the next significant level where BTC is likely to form a local top.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Bitcoin Weekly Forecast: BTC nosedives below $95,000 as spot ETFs record highest daily outflow since launch
Bitcoin price continues to edge down, trading below $95,000 on Friday after declining more than 9% this week. Bitcoin US spot ETFs recorded the highest single-day outflow on Thursday since their launch in January.
Bitcoin crashes to $96,000, altcoins bleed: Top trades for sidelined buyers
Bitcoin (BTC) slipped under the $100,000 milestone and touched the $96,000 level briefly on Friday, a sharp decline that has also hit hard prices of other altcoins and particularly meme coins.
Solana Price Forecast: SOL’s technical outlook and on-chain metrics hint at a double-digit correction
Solana (SOL) price trades in red below $194 on Friday after declining more than 13% this week. The recent downturn has led to $38 million in total liquidations, with over $33 million coming from long positions.
SEC approves Hashdex and Franklin Templeton's combined Bitcoin and Ethereum crypto index ETFs
The SEC approved Hashdex's proposal for a crypto index ETF. The ETF currently features Bitcoin and Ethereum, with possible additions in the future. The agency also approved Franklin Templeton's amendment to its Cboe BZX for a crypto index ETF.
Bitcoin: 2025 outlook brightens on expectations of US pro-crypto policy
Bitcoin price has surged more than 140% in 2024, reaching the $100K milestone in early December. The rally was driven by the launch of Bitcoin Spot ETFs in January and the reduced supply following the fourth halving event in April.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.