Looks like Bitcoin (BTC) is back again with its crazy volatility as it has made some massive moves in a few day’s time. After trading above the $11,700 region for a while BTC shot past $12,000 and hit new yearly high at $12,391. But in the past 24 hours, the token failed to hold above 12k and swiftly dropped as low as $11,579, losing more than $13 billion in market cap.
The correction followed a 6-day bull run that helps the number one cryptocurrency gains more than 11.9%, but the pullback allowed for a retest of the $11,500 level. Moves like these are quite common after a support resistance flip occurs.
Although it remains unclear what caused the reversal, BTC did move into an overbought zone on the 4-Hour RSI that could’ve triggered an avalanche of shorts, causing the drop.
There is also a crucial bullish trend line forming near $11,640 support are on the 4-hour BTC/USD chart. If price action breaks below this trend line, we could see the price moving below $11,500.
According to one trader, $11,700 level has been a crucial one for BTC to maintain a bullish sentiment. He posted a chart noting that a break below the depicted triangle formation would likely lead to more consolidation.
For now, BTC bulls seem to be moving towards $12,100 which is the main resistance area near the psychological $12,000 mark. A similar opinion was voiced by a crypto analyst who expects a run-up to $12,134 if BTC manages a daily close above $11,800.
Once the price reaches these levels, the bulls would be looking to hit the overheard channel resistance near $12,370. Above this area, the rally would likely continue towards $12,500 and $12,800 respectively.
At the time of writing, BTC is trading at $11,821 as it seems to be recovering, and the majority of crypto analysts are expecting a bounce from this level.
One trader even claims that failure in case the bulls fail to maintain momentum, the asset might be retesting $10,000 again.
It is yet to be seen if Bitcoin bulls are finally able to establish solid support above $12,000. The move towards ATH would continue once the token hits $13,000.