What should Bitcoin traders watch out for after the recent flash crash?
Bitcoin price has had some turbulent days, falling to nearly a month’s low on September 7th before rebounding and falling again to a 24-hour low of $ 44,318 today.
BTC price 4-hour chart | Source: Tradingview
The price collapsed on the same day that El Salvador officially introduced Bitcoin as legal money.
Following these dramatic fluctuations, a number of market watchers have offered technical analysis that sheds light on the key levels of support and resistance BTC might face next.
TrendSpider analyst Jake Wujastyk says:
“The first thing to note is that BTC has been very volatile in the last few days, but the price has fallen to a known level: Anchored VWAP *.”
Wujastyk also gives some clarity about the anchored VWAP, noting that “it shows the volume-weighted average price from a certain starting point (anchor point)”.
“It is almost unknown that Anchored VWAP works correctly with Bitcoin. The price fell right on it and then stopped falling. BTC could break that line and signal a price decline, but for now the bulls should see this as encouraging. Note that the price in the $ 50,000 to $ 52,000 range is also very tough. This is the resistance level (selling pressure).
But there is support in the range of $ 40,000 to $ 42,000 as well. It is possible for the price to fluctuate for a while here before it actually moves.
When you put these analyzes together, I can say that bitcoin bulls are still ahead of the game at the moment. If the price doesn’t stay above ~ $ 42,000 (where Anchored VWAP hits ATH) or Anchored OBV (On-Balance Volume) turns red, I’m worried. Until then, I’m still optimistic. “
Jon Pearlstone, CryptoPatterns news publisher, also commented:
“Bitcoin has big support at $ 42,500, so as long as it lasts, bulls will have an advantage. If the September 7 decline is the start of a steeper correction, traders should watch for the rapid decline to test the $ 37,500 support and even below $ 35,000 if $ 42,500 fails.
The upside will see consolidation between $ 42,500 and $ 47,500, followed by a compelling breakout of $ 50,000 on the way to retesting the all-time high of $ 65,000. “
Meanwhile, Zap Protocol co-founder Nick Spanos offers a more conservative prediction:
Bitcoin’s decline to $ 42,483 on Tuesday and the jump to over $ 47,000 confirmed the $ 43,900 area as critical support. While this rebound and the long-term outlook still looks positive, it should be noted that further declines are possible as the RSI has fallen below 50 and the MACD is almost negative.
The MACD indicates that the 12-day EMA is below the 26-day EMA, which shows that bearish momentum is building. Nor should the importance of the RSI fall below 50 be underestimated, as the fall in the RSI below 50 in July marked the start of the most recent bull run in the broader bitcoin and crypto markets.
He added, “BTC closing resistance at $ 47,000. If that level is broken, Bitcoin will test the $ 50,000 mark again. “
Collin Plume, CEO and founder of My Digital Money, described the crypto king’s recent price movements as normal fluctuations.
“Bitcoin has a 20-day MA north top of $ 47,000 and a 200-day MA north top of $ 42,000. That tells me that Bitcoin, breaking $ 50,000 to drop to $ 43,000, is still within what I would call “average price volatility” as it is still within my tolerance range.
The double-digit drop in prices is a horror story for many traditional investors, but it is important to understand that Bitcoin is not a traditional asset. The $ 5,000 gap between the short and long term is solid evidence that Bitcoin swings are inherently a monster, albeit overwhelming to many. “
Dealers Legendary John Bollinger bullish
John Bollinger is betting on the possibility of a Bitcoin price recovery. The father of the Bollinger Bands’ youngest technical indicator tweets that he is currently very optimistic.
“Now I am optimistic on BTC / USD, good risk / reward setup, aiming for the upper band first, stop below the 8/9 low.”
Calling the recent fall “monumental,” Bollinger noted that the price attempted to touch both the top and bottom bands on the same day.
The source: BILLIONradingview
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