2 Worrying Signs That Can Lead to BTC’s Quick Drop Towards $20K (Bitcoin Price Analysis)

The crypto market is currently in a bear market. It is now down 70% from its peak during the last months of 2021. The recent price action has seen Bitcoin bounce over 35% from its current bottom in June.

Technical Analysis

Technical Analysis By Shayan

The Daily Chart

After failing to break $19K, the primary cryptocurrency formed a continuation correction bearish pattern and was consolidating inside.

The lower boundary supported the price and led to a mini rally towards the upper trendline. BTC broke the 50-day moving mean ($21.3K), and then completed a pullback.

The flag’s upper border and the 100-day moving mean (currently at $27K each) will likely be the next major resistance levels to Bitcoin’s price.

A bullish leg will be expected if the price breaks the flag’s upper trendline. A steep bearish trend is expected if the price does not break the flag’s top trendline. This could be the last move to end the capitulation phase of the market cycle.

The 4-Hour Chart

A few weeks back, Bitcoin formed a wedge pattern. This provided excellent support and triggered a bullish rally that culminated in the breakout. We saw the breakout to the upside which led to the rally that we witnessed. BTC is now at its previous swing high.

If the current price of $24K is not broken, a clear double-top price action (which is a bearish reverse pattern) can be seen in Bitcoin’s 4-hour chart. Additionally, the RSI indicator is clearly bearish, as well as the price. This increases the probability of Bitcoin’s recent movements.

Bitcoin may retest support at lower levels due to the double top pattern, divergence between RSI indicator price and price. Bitcoin will move on to the $16K level if the $19K critical support level is not met.

NUPL Analysis of Onchain

It is useful to look at the general sentiment of market participants in order to identify current trends. Bullish cycles often end when key players reach “distribution,” which is when they sell their assets and make profits.

Contrary to popular belief, a bearish phase often ends when large players enter the “accumulation stage” and start buying coins at discounted prices from weak hands.

The indicator dropped to the blue area (= -0.09) due to a sharp fall in Bitcoin’s value below $20K.

This measure had caused a significant capitulation in the market, and led to a renewed bullish rally. The NUPL indicator, however, has shot up after Bitcoin’s recent surge towards the $24K mark. It now enters the Green zone.

After dipping into blue, the measure began a bullish cycle.

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Marla Brooks

Marla Brooks – Financial Analysis My name is Marla Brooks, and I am the mainstream behind the”observednews.com”  for the powerful and most delicate insights into the latest activities in the financial analysis category. I started my journey as an independent financial consultant. I had approximately nine years of experience in this field. I am free soul so; my passion for exploring the world has taken me to the nations across the globe and given me the chance to report for a portion of the best news associations. Currently, I am a full-time editor as experienced in finance and started to use my abilities.

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