- Bitcoin still looks good for $32,000 despite a dip below $30,000 last night
- It still sits above an important support zone
- $35,500 is not off the table, although Bitcoin is looking a little over-extended
Bitcoin still looks good for $32,000 and possibly higher, despite a dip under $30,000 last night. Following its big move last week Bitcoin fell from $30,550 to $29,738 last night, but the slight rebound ensured that it is consolidating at an area of support at $30,000 again. Bitcoin has been operating in this region for a week now, with many believing that there is more fuel in the tank to carry on the rally that started on January 1st.
$30,000 Level Remains Key
Bitcoin’s current position is very clearly highlighted on a weekly chart, with the importance of the $30,000 level being obvious:
Had Bitcoin rejected here when it first tapped it last week, we could have seen a rejection all the way back to $28,000. Instead, price has consolidated around this important area, showing signs that an upward move is more likely than the alternative. As we have pointed out previously, the next key level is $32,000 followed by $36,000:
If Bitcoin is truly bullish and money is waiting to come in from the sidelines, which is not currently the global sentiment, then we can expect something like this to play out to support a bullish narrative:
If something like this were to play out then alts would enjoy another rally and we would be discussing another full-on bull run, or at least a period of accumulation before the next leg up. This fits in with the theory that the next cycle starts this year and accelerates next year with the halving.
What may be more likely however, given that Bitcoin has already gone 100% and many alts have done multiples since January, is that $36,000 acts as the ultimate resistance and Bitcoin bounces between $32,000 and $36,000 for the rest of the year. Don’t forget that we still don’t know what plans the Federal Reserve has to reduce inflation for the rest of this year and the next, and this is still a game of musical chairs until fresh capital is ready to come into the market.
Weekly RSI Hits November 2021 Level
What’s worth noting is that on the weekly level the RSI is at its highest level since the November 2021 top, suggesting that, even if Bitcoin does have some juice left, the tank may almost be empty for this current run:
This is hardly surprising given the three-and-a-half-month run that the crypto market has been on, and, as those in the space will know, nothing lasts forever.