Bitcoin is still in a strong recovery mode. It could surpass the $45,000 price resistance. As bears mount their greatest resistance, this price level is the one to beat. Bitcoin reached this level on Friday early in the morning but, as usual, it experienced significant pushes that caused it to fall below.
Bitcoin lost nearly $1,000 in two hours after the crash. This dip could be described as a lower low, however bitcoin was able to recover from the crash and find support at $44,000. The demonstration of $45,000 is a clear indication that bitcoin cannot be considered to have started a new bull run until it has the ability to beat this level and then settle at or above it.
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Although the market has turned favorable to buyers, sellers remain dominant. Bitcoin must surpass $45,000 to register a new bull run. To do so, buyers will need to support it. If bitcoin fails to achieve this goal, it will fail again. This leaves the market facing another bear market.
The indicators have turned bullish for bitcoin in the short-term. After bitcoin climbed above its 50-day moving average (a crucial milestone in an asset trying to end a bear trend), this is what happened. This move has helped to lift sentiment and reduce fear about the asset.
Bitcoin is worth $45,000, but why?
Due to bitcoin’s trading patterns over the past few months, $45,000 is an important level. The digital asset traded between $36,000 to $44,000 since the December crash. It has never been able to break above $45,000 once. This is the place where bulls have taken their stand. A breach of this level would result in another resettlement to bull territory.
Bears should not be outdone by $36,000. The last four bitcoin breaks above $40,000 were witnessed. As the trend slowed down, significant support came in between $36,000 to $38,000. Breaking below this level would bring bitcoin down below $30,000.
Source: BTCUSD at TradingView.com| Source: BTCUSD on TradingView.com
Each camp has made these crucial points their make or break point, prompting a tug-of-war between them.
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Bitcoin trades at $44,000 as of the writing. However, indicators suggest that Bitcoin will test the $45,000 mark again if it gains enough buying momentum to rebound above $44,600.
Featured image by BBC. Chart from TradingView.com