What is Bitcoin (BTC) Doing Right Now?
Bitcoin is currently trading just below $47,000 and is looking bearish in the short term. As discussed in our previous price analysis, BTC is heading towards a healthy correction, and a temporary drop is highly likely in the coming days.
We have broken below our short-term support at $48,300 and are currently retesting the $46,700 region.
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Analyzing the Charts
On the 1-hour charts, we can observe that BTC was trading within a rising wedge and has finally broken below it. Breaking out of this structure also broke the support at $48,300, which sent the price plummeting to the $47,000 region.
We can also observe that the price is finally breaking below the rising channel we have been respecting on the 4-hour timeframe. If we do end up closing a 4-hour candle below the channel, a drop towards $44,000 or even $40,000 is highly likely.
The trading volume has also been declining, indicating that we will successfully break below this region. However, if we show some bullish momentum in the next couple of hours, we could get above the channel again. It will mean that we have a wick below our channel, but the structure is still intact.
If we do a breakdown, the first level we would be watching as support is the $44,000 region. This region has acted as strong support in the past, and we can expect a price bounce from here.
If we fall to hold this level, we might be going all the way down towards $40,000.
Conclusion: Where is Bitcoin (BTC) Headed?
While we are extremely bullish on Bitcoin in the long term, we are expecting some bearish movement in the immediate short term. If BTC does end up closing a 4-hour candle below the support zone, we would be interested in opening a short position on it.
We would also like to accumulate more Bitcoin once it drops to $44,000. We would be following the Dollar-cost averaging strategy as a fall towards $40,000.
How to Trade Bitcoin (BTC)?
To understand the basics of Bitcoin trading, you can read our How To Trade Bitcoin Guide. It can prove helpful for traders who are just getting started with Bitcoin trading. You can also check out our list of top Bitcoin Exchanges To Trade With.
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