- Technical analysts are predicting a breakout following the ongoing Bitcoin’s price consolidation.
- Both Bitcoin and Ethereum could exhibit further bearish momentum before any major shifts to the upside.
Since Bitcoin lost roughly 50% of its gains in mid-May, the Crypto’s value has been restricted within a defined range. Starting from late May to to-date, Bitcoin’s price has been ranging between $42k and $30k. This price action can be attributed to factors such as the ongoing Crypto crackdown by the Chinese government.
Following the tendencies of price action in the currency market, it is accurate to assert that a break-out is going to happen at some point. According to the CEO of Invest Diva, Kiana Danial, the current BTC consolidation is the ‘calm before the storm.’ BTC has been exhibiting a more bearish than bullish momentum throughout this consolidation phase.
For the remaining part of the week, there are certain levels that every trader should be aware of. As I stated last week, the $34k level was supposed to offer significant resistance in case of any upside movement. After price tested the level of Monday, it appears to be making sharp movements to the downside. Coincidentally, the 100 SMA offered resistance at the $34k level on the 4hr chart. Currently, the price is moving lower, exposing the $29,238 level.
Thus, while the $34k level offers immediate resistance to the upside, the $29,238 level offers the short-term support level for BTC. The levels are shown in the 4hr chart below;
Image from meta trader 5
With Ethereum trading around the $1,881 level at the time of writing this article, the $1,729 level will likely be tested before any significant upside momentum is experienced. In the case of upside momentum, the $2,143 level should offer immediate key resistance. Given that the price would break above this level, the $2,351 level should offer the next resistance level.
On the 4hr chart, the price is trading below the 200 and 100 simple moving averages. The 100 SMA is also below the 200 SMA following the death cross that happened on the 4th of June 2021. All these technical indicators represent the presence of more bears than bulls in the market. The chart below shows the levels that are worth watching for the rest of the week;
Image from meta trader 5
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