Bitcoin’s bulls were greatly disappointed to see the strong rejection the cryptocurrency incurred at $9,200 following what appeared to be an incredibly strong rally yesterday evening.
The rejection at this level was drive by strong volume and shines a light on the fact that bears still have massive strength in spite of their recent weakness and may also suggest that these recent highs could be a mid-term top for the cryptocurrency.
Prominent analysts, however, are also noting that they believe Bitcoin’s market structure is still firmly bullish as long as it ends the day above $8,600, which means how it trades in the next few hours could be critical for its future trend.
Bitcoin Dumps to a Key Support Level, But the Bull Trend Isn’t Over Yet
Currently, Bitcoin is trading down just under 3% at its current price of $8,650, which marks a notable decline from its daily highs of $9,200.
Today’s vertical drop has not (as of yet) been enough to thwart the cryptocurrency’s mid-term uptrend, as it is currently trading at around where it was at just a few days ago.
While keeping this in mind, it grows clear that although the crypto is expressing some short-term bearishness, its market structure does appear to still be bullish and it may continue to climb higher in the near-term.
SmokeyXBT – a popular cryptocurrency trader on Twitter – spoke about this in a recent tweet, telling his followers that he believes drops like this one are typical in the crypto markets, and not enough to invalidate a mid-term trend.
“XBT Not sure about you guys but imo this is all pretty standard stuff what we’re seeing on Bitcoin and the bias is still bullish, not bearish like a lot of people seem to want to push here on CT,” he explained in a recent tweet.
Not sure about you guys but imo this is all pretty standard stuff what we're seeing on Bitcoin and the bias is still bullish, not bearish like a lot of people seem to want to push here on CT pic.twitter.com/Vk1P2JjfeJ
— Smokey Hosada (@BeegSmokey) January 19, 2020
Luke Martin, another prominent analyst, did previously note that $8,600 is a key level for Bitcoin, so a break below this level prior to its daily and weekly close could signal that a deeper pullback is imminent.
“‘Close above 8600 leads to 9100 expansion.’ Wrapping this weekly $BTC outlook thread now that we’ve hit the targeted resistance & pulled back. Hope we get another trending market this week!” he noted while referencing previous tweets regarding the importance of the $8,600 level.
"Close above 8600 leads to 9100 expansion."
Wrapping this weekly $BTC outlook thread now that we've hit the targeted resistance & pulled back.
Hope we get another trending market this week! pic.twitter.com/1eJx6YaFEO
— Luke Martin (@VentureCoinist) January 19, 2020
How the markets trend in the coming hours as BTC nears both its daily and weekly close will offer investors greater insight into where the markets may head next.