Increased likelihood of breakdown as Bitcoin continues to be rejected at $100,000: Bearish Case
Bitcoin is facing a tough beginning to the year 2025 with struggles to hold above the $100,000 mark. Despite breaking through in early December, Bitcoin has continuously faced rejections after peaking above $100,000. The most recent rejection saw the price drop from $102,000 to $92,000 within a few days.
This ongoing battle has brought the bearish scenario into focus, with technical analysis indicating a 50/50 chance of Bitcoin either dropping further or bouncing back.
A Crucial Support Zone at $90,000
The $90,000 price level has emerged as a key support level for Bitcoin. While the cryptocurrency has managed to stay above $90,000 during recent corrections, the bearish outlook depends on its ability to defend this level.
According to analysis by crypto expert EGRAG CRYPTO, Bitcoin has tested a support trendline around $90,000 five times, emphasizing the level’s significance. This repeated testing weakens the support strength, making Bitcoin susceptible to a significant decline.
To maintain a bullish outlook, Bitcoin bulls need to stay above $90,000 and break through resistance levels above $100,000. A drop below $90,000 could lead to a further decline to $87,000 or even lower, potentially reaching $75,000.
Breaking Through Resistance Levels: $103,000 to $108,500
EGRAG CRYPTO notes that Bitcoin remains bearish until it surpasses several resistance levels. These key levels are at $103,000, $106,400, and $108,500, requiring consistent daily closes above them to confirm a bullish trend. A breakthrough above $108,500 would push Bitcoin to new all-time highs.
Current technical indicators suggest a low probability of a price surge at the moment. For instance, Bitcoin lost the support of the 21 EMA on the daily timeframe and sentiment is neutral on the Fear and Greed Index.
The upcoming inauguration of Donald Trump on January 20th and the potential crypto-friendly policies under the new administration could be the catalyst for a bullish comeback for Bitcoin. EGRAG CRYPTO suggests that the event could either spark a short-term rally or worsen the current decline. At present, Bitcoin is trading at $94,400.
Featured image from Pexels, chart from TradingView
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Filed under: News - @ January 12, 2025 11:23 pm