Bitcoin incurred a sizeable rally last night after it plummeted to lows of $6,500, with the swift bullish reaction to this level leading many analysts to believe that the cryptocurrency had finally established a mid-term bottom that would allow it to shift its long-held bear trend.
This rally, however, has shown some signs of faltering as bulls fail to maintain the momentum that was sparked from the recent capitulatory drop, which has led multiple analysts to set short term targets below $7,000 for the embattled cryptocurrency.
Bitcoin Rockets from Intra-Day Lows as Bulls Fight Back
At the time of writing, Bitcoin is trading up marginally at its current price of $7,250, which marks a notable climb from its daily lows of $6,500 that were set yesterday after a long period of grinding lower.
Bitcoin’s ability to surge at this level signals that a significant amount of buying pressure exists at $6,500 and it is highly probable that this level will continue being a strong support level for the cryptocurrency in the days and weeks to come.
The upwards momentum that came about after BTC tapped this support level led the crypto as high as $7,400 before the rally stalled and it retraced down to its current price levels.
This retrace from $7,400 has led multiple analysts to believe that Bitcoin is positioned for another visit to the upper-$6,000 region in the near-term, with HornHairs – a popular cryptocurrency analyst on Twitter – telling his followers that he is targeting Bitcoin’s original swing low at $6,900.
“$BTC short: First trade of the week: shorted the sweep of the range high. Targeting original swing low and bounce at $6.9k and then current swing low at $6.7k,” he explained.
Assuming that Bitcoin does drop back below $7,000 in the near-term, Bitcoin’s bulls could continue to flip bearish, opening the gates for significantly further losses in the near-term.
HornHairs is not alone in his short-term bearish analysis of BTC, as TraderX0, another popular cryptocurrency analyst on Twitter, explained in a tweet that he is scaling into short positions as BTC was rejected at its near-term supply level at roughly $7,400, which may signal that further losses are imminent.
“$BTC – Shorted. Hello range – nice to see you again! Range swing highs finally tapped. Avg entry 7295 – scaled in… wouldn’t mind loading more shorts further up,” he noted.
The coming few hours and days will likely elucidate the long-term importance of the recent relief rally, as further downside may confirm that it was a dead cat bounce and that further losses are imminent.