BTC could retest the $45,000 area in the next few days.
Similar to the May-July 2021 consolidation, the market is forming a strong supply/demand zone in the $40,000-$42,000 range. In addition to the short-term price trend, the area in question will represent significant support (or resistance) for long-term price movements.
Many analysts believe that the $40,000 – $42,000 zone is the same as the $30,000 – $32,000 zone in May – July. Since December 5th, the $40,000 – $42,000 zone has acted as good support.
However, given the low demand in the spot market, Bitcoin could see a lower price if this strong support doesn’t hold (Bitcoin closed the day below). Fibonacci levels are displayed on the daily time frame. The 0.382 Fibonacci level and the red zone cross over creating a strong resistance area at $50,000 – $51,500.
Despite a positive move over the weekend, Bitcoin failed to surpass $44.5K. This rejection shows that the bears are still actively selling at higher levels.
In the 4-hour period, Bitcoin broke above the downtrend line (orange line). It looks like the pullback is complete and the cryptocurrency might make another attempt to break the $44.5k – $45k resistance in the next few days.
Considering the open limit order heatmap, it is clear that FTX has played an influential role in recent price action since the market dropped to 40,000 (December 2021). There are many examples where the price reacts to the buy/sell walls of this exchange. Therefore, it may be wise to keep an eye on this order book to predict price action in the near future.
Disclaimer: This article is for informational purposes only, not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.
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