- Bitcoin spooked traders yesterday with a $6,150 drop after spiking to all-time highs
- Bitcoin hit $69,000 before its sharp correction
- It ended at a point of support we highlighted on Monday as being crucial if it held
Bitcoin endured a quickfire $6,150 correction after spiking to new highs of $69,000 yesterday, leaving it sitting just above a key line of support. After assuming a breakout was on the cards following its jump to an all time high, traders were shocked to see it plummet to $62,850, wiping out $100 million worth of margin traders in long positions. However, the drop merely leaves Bitcoin at the support area outlined on Monday, with a resumption of the uptrend likely assuming that support holds.
Key Support Level Holds
After Bitcoin hit a prior all-time high of $68,500 over the weekend, we suggested that there were two areas of interest should a likely correction take place:
As we can see, after $100 million worth of liquidations caused a wick to $62,850, Bitcoin eventually came to rest just above the key area of support:
Assuming Bitcoin remains above this zone this is very bullish for the market, with funding now having reset, which means the world and his dog is not not in a long position. The crypto markets have now been flushed, which will now probably result in a period of consolidation around this area, before continuation. If this is indeed the case then we can say that $64,000 is now considered an area of strong support, which provides a great level going forward.
Long Term Outlook Bullish For Bitcoin
When we zoom out to a weekly timeframe we can see that Bitcoin is beautifully poised for further upwards momentum, if the 2020 crash is to be used as an example:
Of course it’s a virtual impossibility that we see the same scale growth from this period, but we can clearly see that a crash followed by a return to prior highs usually results in one thing – WAGMI.
