The price of Bitcoin (BTC) declined in 2024, but recovered with a strong rebound last week.
BTC is trading very close to the confluence of Fib and horizontal resistance levels. Will it blow up or will it be rejected?
Bitcoin regains ground
Technical analysis of the weekly time frame shows that Bitcoin price rejected the 0.618 Fibonacci retracement resistance level in the second week of January 2024.
This has created a bearish weekly shooting star candle (red icon), characterized by a very long upper wick. After the rejection, BTC fell below the 0.5 Fib retracement support level. However, last week it started an upward movement and has almost recovered it.
BTC/USD weekly chart. Source: TradingView
Despite this rebound, the weekly Relative Strength Index (RSI) is still bearish. Market traders use the RSI as a momentum indicator to identify overbought or oversold conditions and to decide whether to accumulate or sell an asset.
Readings above 50 and an uptrend indicate that bulls still have an advantage, while readings below 50 suggest the opposite. The RSI is declining and has fallen below 70 after previously moving into overbought territory, both signs of a bearish trend.
What do the analysts say?
Cryptocurrency traders and analysts on X have a mixed view of BTC’s future trend.
CryptoMichNL suggests that the price will rise to $50,000. He tweeted:
#Bitcoin consolidates and acts boring. It will likely seek a higher low, after which we will have a slight pre-halving push to $48-51,000.
BTC/USDT daily chart. Source: X
XForceGlobal has the same perspective, although it uses Elliott Wave Theory to reach its conclusion. Credible Crypto suggests that the price has started a new trend that will take it to new highs. However, he believes a short-term retracement is due.
BTC Price Prediction: Will New Lows Emerge?
The daily time frame technical analysis provides a mixed reading due to the price action and RSI readings.
The bullish outlook shows that BTC price has reclaimed the $41,000 horizontal support area after deviating below it. However, it is trading below the 0.5 Fibonacci retracement resistance level at $43,800.
Furthermore, a strong resistance level at $45,100 is created by the 0.618 Fibonacci retracement resistance level and a horizontal resistance area.
Finally, the daily RSI still faces resistance from its bearish divergence trend line (green) and is near 50. It needs to break above this resistance to initiate a bullish trend reversal.
If BTC breaks above the $43,800 resistance, it could rise 5% to the $45,100 resistance.
BTC/USDT daily chart. Source: TradingView
Despite the bullish BTC price prediction, a rejection from the 0.5 Fibonacci retracement resistance level can trigger a 5% drop to $41,000.
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