The bleeding seems to have been stymied, for now, after Bitcoin’s (BTC) brutal selloff from a rejection at $12,000 is being held around $10,000. Buyers stepped in to push the crypto back above the key psychological mark, after BTC sold all the way down to $9,400.
Looking first at the 12-hour chart, we see buyers pouring in to keep the crypto safely above $10,000 (or short-sellers taking profit). A deep buy wick signals this, as does the highest volume bar in the last few days. It is no surprise that price held first at $9,400, as this has been a key level during the present market structure, during July especially.
If price holds here, we can eject the brief fall to $9,400 from our analysis of the market structure as only a brief period of noise. Although scary, only significant candle closes on key time periods – like the daily, or 4-hour – count in our analysis. This rapid reclaiming of $10,000 is certainly auspicious of it holds.
Looking at a cleaner 4-hour chart, we can now highlight the possibility of a sideways consolidation.
This is fairly likely to play out if price can hold this level. Buyers need to remain resilient in keeping Bitcoin above $10,000, and we’ll see whether or not this is the case in coming days
Looking at a marked up 4-hour chart, we see the alternative – and it’s not pretty. Bitcoin is unlikely to hold again above $9,000 if this level breaks, as it would be the third test of this floor since June.
The bottom of this channel is confluent with the sub-$8,000 price level that many analysts had been calling for, as the appropriate floor of a Bitcoin retrace after the 2019 bull run.
It is anybody’s guess if $10,000 will hold. Bitcoin has certainly shown its attraction for buyers during 2019, who at key moments have stepped in to preserve a strong medium term uptrend. This is one of those moments. We will have to see if there is follow through here into a new consolidation pattern; if not, $8,000 and below is ultimately likely.