BTC Strongly Rejected at $24,000 Again, Is a Correction Looming? (Bitcoin Price Analysis)
Over the past week, Bitcoin has seen numerous on-chain and technical bullish signals. However, reaching a significant resistance level at $24,000, there was a battle between the bulls and the bears. The main question is whether this is the start of a bull market or just a bullish trap.
Technical analysis
Through Shayan
The daily chart
Bitcoin’s impulsive uptrend was halted by the psychologically significant resistance level of $24,000. During this time, the price entered a consolidation phase, casting several large shadows on the candle chart.
This structure implies that there has been an ongoing battle at this crucial level. The winner will determine the direction in the medium term. If there is a break from the mentioned level, the market may suddenly rise.
On the other hand, the 50-day moving average claimed the 100-day moving average at around $18.7,000, a definite bullish sign for the price in terms of price action.
Additionally, the price recently broke above the long-term descending trendline. Still, the breakout momentum was not strong enough to rule out the fake breakout scenario.
The 4 hour chart
Despite the bullish signals on the daily chart, the price action doesn’t look so good on the 4-hour timeframe. Bitcoin faces two crucial resistance levels; $24,000 and $25,000. Currently, the price is fluctuating in the $23,000 region and has formed a three-disk reversal pattern inside a bearish rising flag. A short-term corrective stage could take place if Bitcoin falls below the lower trendline.
On the other hand, if the trendline supports the price, the next stop will be the $25,000 primary resistance level. Additionally, the divergence between the RSI indicator and the price has been highlighted, signaling that a short-term consolidation correction phase may occur soon.
On-chain analysis
Through Shayan
Although Bitcoin has reached what many describe as the early stage of a bull market, the amount of BTC entering exchanges has remained subdued. Additionally, BTC whales, a vital cohort among market players with over 1,000 bitcoin holdings, have yet to transfer a sizable amount of coins to exchanges.
On the other hand, Bitcoin miners are another crucial cohort that affects the market with their spending behavior. The following chart shows the miner reserve metric next to the price. In the case of miners, a considerable spike can be seen in bitcoin flows to exchanges (5,592 BTC on January 19) once prices hit the $20,000 price level.
As a result, the Miner Reserve metric has seen a sudden drop, implying that the recent uptrend presents an excellent chance for this essential cohort to control their market exposure, manage their mining spend, and allocate their holdings to achieve benefits. If the spending behavior continues, the market could enter a short-term consolidation in the coming days.
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